- Proposals have been put forward to amend the Securities Act.
- Collective Investment Schemes (CIS) in Jamaica are primarily regulated by the FSC under the Unit Trust Act.
- The Ministry would be seeking to tighten the liquidity regulations and assess further prudential reforms.
As the Government continues to reform the financial sector and strengthen the legislative framework for regulation of the securities industry, proposals have been put forward to amend the Securities Act, to combat the establishment and proliferation of unlawful financial organizations.
“Whilst the Financial Services Commission (FSC), in conjunction with other regulatory agencies, used various means of communication to persuade the unsuspecting public not to put their money in these institutions, they still grew. It (therefore) became clear that there needed to be stronger penalties and a strengthening of the interventionist capacity of the FSC,” says Minister of Finance and Planning, Dr. the Hon. Peter Phillips.
“In that regard, one of the amendments being proposed is the introduction of civil penalties as a deterrent to the establishment of unlawful financial organizations,” the Minister added.
Dr. Phillips was addressing delegates and representatives from the Caribbean, at the 10th annual Caribbean Group of Securities Regulators’ Conference and Workshop, held at the Hilton Rose Hall Resort and Spa, in Montego Bay, on November 6.
The Minister informed that currently, Collective Investment Schemes (CIS) in Jamaica are primarily regulated by the FSC under the Unit Trust Act and its attendant regulations, as well as the Securities (Mutual Funds) Regulations.
“A more comprehensive legal and regulatory framework conducive to enhancing the capacity of the FSC to regulate collective investment schemes is now being contemplated,” Dr. Phillips pointed out.
He explained that, in conjunction with these reforms, the Ministry would be seeking to tighten the liquidity regulations and assess further prudential reforms such as, capital requirements, margin rules, and concentration and minimum transaction size limits.
The Minister argued that if the Caribbean is to return to the path of sustained economic growth and to deliver on the legitimate expectations of the people for a higher standard of living and a better quality of life, “then an essential element in this matrix will involve the strengthening of the regulatory framework for the capital markets generally.”