Financial Services Ireland welcomes signing into law of new Individual Accountability Framework
Financial Services Ireland (FSI), the Ibec group that represents the financial services sector in Ireland, has welcomed the signing into law of the new Central Bank (Individual Accountability Framework) Act 2023.
The legislation will give the Central Bank of Ireland (CBI) new powers to hold individuals accountable for wilful acts of wrongdoing in the industry. Its intention is to bring Ireland in line with international norms, in particular with those in the UK, Australia, Denmark and the Netherlands.
The Act has now been signed into law by the President. The next step is for the Central Bank to bring forward regulations and guidance around the implementation of the new Act, including a timeframe for when the new rules will begin to apply to the financial services industry. The proposed regulations and guidance will be subject to a public consultation.
Commenting on the Act, Financial Services Ireland Director Patricia Callan said: “This legislation is the culmination of a multi-year process of engagement and is the most significant piece of legislation for the industry as a whole in the last ten years. The financial services industry directly supports 116,000 jobs in Ireland and our focus is on ensuring a credible, proportionate and transparent regulatory system.
“We look forward to further engaging with the Central Bank on the detail of its proposed secondary legislation – as well as to agree a reasonable timeframe for industry to prepare for the new rules, once finalised. In our view, this should be 12 months. We also want to ensure that this powerful enforcement tool will be deployed dissuasively and where necessary, against wilful acts of wrongdoing. It must not operate to dissuade people from choosing financial services as a career or investing and doing business in Ireland.”
The July 2018 Conduct & Behaviour in Irish Retail Banks report is the cornerstone of the regime, which comprises four pillars: conduct standards applicable to all staff; a Senior Executive Accountability Regime applicable to leadership teams; an enhanced Fitness & Probity regime; and a new, streamlined enforcement regime that will remove the requirement for the CBI to first prove wrongdoing at the firm level, before pursuing individuals.