JDIC Report Outlines Laws Passed

During the 2006/07 financial period, a number of key laws were passed, in order to bring technological developments that are in use by or are impacting the financial services, under a clearly defined framework.
As explained in the 2006/07 annual report of the Jamaica Deposit Insurance Corporation (JDIC), this was done to assist commerce and protect consumers of financial and other services.
These included the Banking (Banking Business) (Electronic Money) Order 2006, which formally recognized card-based electronic transactions as banking business, and the Electronic Transactions Act.
This piece of legislation will, under specified conditions, include the development of rules for the recognition of electronic signatures and due certification, as well as ensure the security and legal efficacy of electronic transactions, the report elaborated.
“With the impending regulation of deposit-taking co-operative societies (credit unions) by the Bank of Jamaica, the Co-operative Societies Amendment Bill was tabled, and this will see the restriction of deposit-taking to only those co-operative societies which operate as credit unions. Bank of Jamaica regulations for the prudential supervisory regime of credit unions were also under review during the year,” the report notes.
Meanwhile, the Bank of Jamaica (BoJ) continued to work toward the development of an omnibus statute, which will see the incorporation of the Banking Act, the Financial Institutions Act, and the Building Societies Act under one statute, which will ensure that provisions for consolidated and conglomerate supervision are appropriately robust. These developments, the report states, will bring the banking sector in line with the international standards prescribed in the recently issued Revised Basel Core Principles. These principles are the “minimum requirements” applicable to banking supervisors in all countries. They have been used by national supervisors as a benchmark for assessing the quality of their supervisory systems and for identifying future works needed to ensure sound supervisory practices.
In addition, work continued on regulations for amendments related to improving and upgrading the application forms for the licensing of financial institutions under BoJ supervision. Pending also, was the revision of fees payable by building societies to bring them in line with those of banks. Other regulations were being developed, with a view to ensuring the independence of the auditors of financial institutions, the enhancement of the credit assessment process, and the taking of security by financial institutions.
The report also notes that the Proceeds of Crimes Act was passed, repealing the Money Laundering Act and the Drug Offences Forfeiture of Proceeds Act. Meanwhile, the Financial Investigations Division Act is still under development and is intended to satisfy Jamaica’s obligation to comply with recommendation 26 of the Financial Action Task Force 40 (revised) recommendations.
The Terrorism Prevention (reporting entities) Regulations are to be promulgated under the Terrorism Prevention Act, and will outline the operational controls that must be maintained by financial institutions, especially when contemplating the commencement of a business relationship or one-off transactions, the report points out.