MAS consults on the revisions to misconduct reporting requirements and the proposals to mandate reference checks for representatives. Part A of the paper proposes revisions to the scope of entities and the requirements on reporting of misconduct by representatives. Part B of the paper sets out the proposed requirements for financial institutions to conduct and respond to reference checks on representatives. Comments are requested by August 06, 2018.
The proposed misconduct report template is included in Annex B and the proposed investigation report template is included in Annex C to the consultation paper. The paper proposes the following:
- Scope to include Registered Fund Management Companies
- Revisions to the categories of reportable misconduct
- Financial institutions to update MAS on the outcome of police investigations
- Requirement by financial institutions to notify representatives when they are under investigation and provide them with a copy of the misconduct report filed with MAS
- Enhanced standards for financial institutions' investigation processes and the requirement for financial institutions to submit investigation reports to MAS in a prescribed format
- Requirement by financial institutions to conduct reference checks on prospective representatives and to share information on their representatives, in response to the reference check requests
Financial institutions are currently required under the Securities and Futures Act (SFA), Financial Advisers Act (FAA), and Insurance Act (IA) to lodge a report with MAS when they become aware of any misconduct committed by their representatives or broking staff; the misconduct includes acts involving fraud, dishonesty, inappropriate advice, misrepresentation, or inadequate disclosure of information to customers. Financial institutions are also expected to have in place a robust and transparent process to investigate possible wrong-doings by their representatives and take appropriate disciplinary actions against the representatives, for any misconduct committed.
Comment Due Date: August 06, 2018
Keywords: Asia Pacific, Singapore, Insurance, Securities, Misconduct Reporting Requirements, Misconduct Risk, SFA, MAS
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