Licensees also have statutory responsibilities under other pieces of legislation the administration of which reside principally with other competent authorities (e.g. The Jamaica Deposit Insurance Corporation; The Financial Intelligence Division; the Department of Public Prosecution :

	The Companies Act, 2004
	Deposit Insurance Act, 1988
	The Terrorism Prevention Act, 2005
	The Income Tax Act
Ministry of Justice

Proceeds of Crimes Act (POCA)- This Act was passed by Parliament in March 2007 and came into effect on May 30, 2007. POCA is a wide-ranging legislation that targets benefits derived from the commission of any crime, and incorporates the concept of money laundering as well as introduces the principle of civil procedure.

With the passage of POCA the Drug Offences (forfeiture of Proceeds) Act, Dangerous Drugs Act, Money Laundering Act, 1996, and the Money Laundering Regulations, 1997 have been effectively repealed and replaced.

LEGISLATIVE AMENDMENTS AND DEVELOPMENT OF SUBSIDIARY LEGISLATION

On-going review of the legislative framework is a necessary and fundamental step in achieving supervisory policy and developmental objectives, especially given the dynamism in local and international markets and the evolving nature of international best practice standards in banking supervision. I n this regard, the Bank of Jamaica is involved in a number of initiatives for amendment of legislation and development of related regulations as follows:

  Credit Classification/Provisioning Regulations - The Bank is undertaking a comprehensive re-draft of proposed Regulations which address loan accounting, credit classification and loan provisioning requirements. This review will take account of developments in international standards such as the Basel Core Principles, the BASEL Standard for Sound Credit Risk and Valuation for Loans as well as International Financial Reporting Standards (IFRS) while ensuring that requirements remain relevant to local conditions and allow for appropriately prudent recognition of asset impairment and capital.

  Qualifications of Auditors Regulations - Regulations that specify expectations for auditors in undertaking an external audit of a supervised financial institution, have been drafted and are with the Minister of Finance for approval. Among other things, the criteria specified in these regulations relate to the independence, experience and academic qualification of the external auditors. These proposed regulations would also require prior notification to the Bank of Jamaica of proposed appointments. The Bank of Jamaica would also be empowered to object to the appointment of an external auditor if, in the view of the Bank of Jamaica, there is evidence that such auditor is not in compliance with the provisions of the regulations.

  Bank of Jamaica (Credit Unions) Regulations - Regulations to establish the supervisory regime that will be applicable to credit unions have been drafted. These regulations will, among other things, prescribe prudential criteria and minimum solvency standards covering, inter alia, essential areas such as capital adequacy, liquid assets, credit and provisioning, submission of financial statements and remedial action that can be taken by supervisory authorities with respect to problem credit unions. The draft Regulations have benefited from extensive dialogue with the credit union sector and are pending presentation to Parliament by the Minister of Finance.

  Omnibus Bill - Jamaica has identified a need to consolidate the Banking Act, the Financial Institutions Act and the Bank of Jamaica (Building Societies) Regulations, in tandem with related subsidiary regulations. The new ‘Omnibus' Bill will also seek to include all legislative amendments necessary to achieve the fullest possible compliance with the Basel Core Principles for Effective Banking Supervision. The Bill will also provide a broader framework for regulation and consolidated supervision with respect to the activities of licensed deposit-taking entities and their financial holding companies. Revisions to the draft Bill now in process, are focused on issues such as: the proposed role of credit bureaus, enhancements to banking supervisory powers with respect to the investigation and prosecution of illegal deposit-taking activities, clarity on the circumstances in which illegal activity will be deemed to have taken place, electronic reporting and consolidated and conglomerate supervision.

Conglomerate/Consolidated Supervision - Although the Bank of Jamaica has already introduced aspects of conglomerate supervision (e.g. fit and proper assessments of principals of the parent company of licensed entities, and requirement for the submission of annual audited financial statements of all members of the conglomerate group of which the licensee is a part), the Bank has identified a need to widen its supervisory scope consistent with international standards. Further to legislative amendments effected in 2002, which gave the BOJ certain enhanced powers for consolidated supervision, work began in 2005 toward the framing of ‘Holding Company' Regulations under the proposed Omnibus legislation. These Regulations are intended to allow the Supervisory Authority to regulate not only the activities of the licensed deposit taking entity, but also of the financial holding company, as well as facilitate supervisory reach to the entire financial group of which the licensee is a part. As a corollary development, the Bank of Jamaica is in the process of developing a Standard of Best Practice and guidelines on Consolidated Supervision in Jamaica . This will prescribe consolidated capital charges, impose limits in relation to overall banking activities conducted with group members on a consolidated basis, as well as delineate the circumstances where the Supervisor may require restructuring of a group and formation of a separate financial holding company for the financial subsidiaries, to facilitate greater transparency.

The Financial Investigations Division Bill - The BOJ by virtue of its chairmanship (at the request of the Minister of Finance) of the Task Force on Financial Crime has been involved in the development of a law to govern Jamaica 's Financial Intelligence Unit (FIU), namely the Financial Investigations Division (FID). When passed the FID legislation will, among other matters, establish the FID on a statutory basis thereby increasing the independence of this Unit and facilitating the Unit's admission to membership of the Egmont Group (the international body of FIUs); expand the investigative tools available to the FID for the investigation of suspected financial crimes; and establish specific penalties for non-compliance with directives or requests for information issued by the FID.

Building Societies (Licences) Regulations - The Building Societies (Licenses) Regulations are being amended to harmonise the licensing fees payable by building societies on the grant of a license and annually, with the rates applicable to commercial banks and FIA licensees.