The Central Bank of Ireland primarily through the Administrative Sanctions Procedure investigates and sanctions suspected contraventions of financial services law by regulated firms and individual (the latter via the Fitness & Probity regime).
Enforcement investigations and fines have increased over the last number of years with significant fines being imposed on several regulated firms. The Central Bank have proposed enhancing their Administrative Sanctions regime as part of the proposed Individual Accountability Regime.
The CBI & enforcement
The mission of the Central Bank is to serve the public interest by safeguarding monetary and financial stability and by working to ensure that the financial system operates in the best interests of consumers and the wider economy. The Central Bank’s enforcement work seeks to further this mission by ensuring that regulated firms and individuals are held to account where their behaviour fails to meet required standards.
The Central Bank use several tools to act against regulated entities under these circumstances including:
- Administrative Sanctions Procedures (ASP)
- Fitness & probity investigations
- Refusals and revocation of authorisations
- Summary criminal prosecution
The cost of enforcement investigations
Over recent years in Ireland, a lack of trust in the financial services industry, especially in banking, has developed. This has stemmed from numerous cultural failings in Irish financial services institutions which have resulted in scandals such as the Tracker Mortgage Examination (TME). Consequently, in Ireland, we have seen an increase in the number of enforcement investigations being taken by the Central Bank against financial institutions.
Enforcement investigations can be costly for organisations – not only do organisations have to pay the fine imposed but there is often a significant cost associated with responding to the ASP or F&P investigations and in certain instances large teams and other resources are required to deliver such programmes. There is also the reputational damage and cost such investigations and sanctions pose to firms.
How we can help
Responding to an enforcement investigation can take an extensive amount of work and may be unchartered territory for an organisation. KPMG can help. We have extensive experience in responding to regulator enforcement investigations and we know the common pitfalls clients experience:
- Design and implementation of the enforcement programme.
- Enforcement programme management ensuring appropriate programme governance and oversight are maintained.
- Provision of regulatory and investigation SMEs.
- Interpreting statutory investigation requests.
- Developing pragmatic plans and actions to address the investigation requirements, bearing in mind your firm’s technology, systems, data retention policies and records management infrastructure.
- Delivering forensics support by providing sophisticated technology tools, proven enforcement methodology and expertise behind information identification, extraction, and production to facilitate the review of documentation and data pertaining to the Central Bank request.
- Finally assisting you with the interview process for key individuals.
Why KPMG?
Our enforcement team is made up of a multi-disciplinary KPMG team based in Ireland from programme managers, compliance, conduct and assurance specialists, remediation specialists, regulatory specialists, legal specialists and a dedicated forensic technology services team.
With KPMG, you can have confidence that you’re partnering with the best team in the market, with unrivalled experience, insight and commitment. We incorporate the latest global thinking into the provision of our services in the financial services sector and provide best practice advice.
Contact our Enforcement team today for assistance with enforcement investigations in your organisation. We'd be delighted to hear from you.
Gillian Kelly
Head of Consulting
KPMG in Ireland