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Fitness and Probity in Financial Services
The Central Bank Reform Act 2010 provides the Central Bank with a range of powers regarding fitness and probity for persons in certain positions within the financial services sector. The Bank is empowered to:
- Approve or veto the appointment of people to certain positions
- investigate and where appropriate remove or prohibit certain provisions holders; and
- set statutory standards of fitness and probity across the financial services sector.
The Central Bank has now published Regulations and a set of Standards of Fitness and Probity setting out various requirements.
- Central Bank Reform Act 2010 (Sections 20 and 22) Regulations 2011 (SI 437/2011).
- Fitness and Probity Standards Code under Section 50 of the Central Bank Reform Act 2010
The Regulations clarify that the requirements apply to two main areas. Persons in “pre-approval controlled functions” (PCFs) will require Central Bank approval before they can take these senior positions. The Regulations also prescribe specific categories of staff as “controlled functions” (CFs) which are positions from which individuals can be temporarily or permanently removed or prohibited.
The new requirements are being introduced on a phased basis. From 1 December 2011 existing and new staff in PCFs will be subject to the regulations and standards. Firms are required to notify the Central Bank of each individual in the organisation in a PCF by 31 December 2011.
From 1 March 2012 new appointments to less senior positions (CFs) will be subject to the Regulations and standards. From 1 December 2012 the Regulations and Standards will apply to all staff and existing CFs.