Banking Act 2009

[F1 Enforcement U.K.

Textual Amendments

F1 Pt. 5A inserted (29.8.2023) by Financial Services and Markets Act 2023 (c. 29), s. 86(2)(d), Sch. 9 para. 1

206O Inspection U.K.

(1) The Bank of England may appoint one or more persons to inspect the performance by a recognised person of a relevant function in relation to a wholesale cash distribution activity.

(2) A recognised person who performs a relevant function in relation to a wholesale cash distribution activity must—

(a) grant an inspector access, on request and at any reasonable time, to premises on or from which any part of the function is performed, and

(b) otherwise co-operate with an inspector.

206P Inspection: warrant U.K.

(1) A justice of the peace may, on the application of an inspector appointed under section 206O, issue a warrant entitling an inspector or a constable to enter premises if—

(a) there is performed on the premises any part of a relevant function in relation to a wholesale cash distribution activity, and

(b) any of the following conditions is satisfied.

(2) Condition 1 is that—

(a) a requirement under section 206Z3 (information) in relation to the relevant function has not been complied with, and

(b) there is reason to believe that information relevant to the requirement is on the premises.

(3) Condition 2 is that there is reason to suspect that if a requirement under section 206Z3 were imposed in relation to the relevant function in respect of information on the premises—

(a) the requirement would not be complied with, and

(b) the information would be destroyed or otherwise tampered with.

(4) Condition 3 is that an inspector—

(a) gave reasonable notice of a wish to enter the premises, and

(b) was refused entry.

(5) Condition 4 is that a person occupying or managing the premises has failed to co-operate with an inspector.

(6) A warrant—

(a) permits an inspector or a constable to enter the premises,

(b) permits an inspector or a constable to search the premises and copy or take possession of information or documents, and

(c) permits a constable to use reasonable force.

(7) Sections 15(5) to (8) and 16 of the Police and Criminal Evidence Act 1984 (warrants: procedure) apply to warrants under this section.

(8) In the application of this section to Scotland—

(a) the reference to a justice of the peace includes a reference to a sheriff, and

(b) ignore subsection (7).

(9) In the application of this section to Northern Ireland—

(a) the reference to a justice of the peace is a reference to a lay magistrate, and

(b) the reference to sections 15(5) to (8) and 16 of the Police and Criminal Evidence Act 1984 is a reference to the equivalent provisions of the Police and Criminal Evidence (Northern Ireland) Order 1989.

206Q Independent report U.K.

(1) The Bank of England may require a recognised person who performs a relevant function in relation to a wholesale cash distribution activity to appoint an expert to report on the performance of the function.

(2) The Bank may impose a requirement only if it thinks—

(a) the person is not having sufficient regard to principles published by the Bank under section 206K,

(b) the person is failing to comply with a code of practice under section 206L, or

(c) the report is likely for any other reason to assist the Bank in the performance of its functions under this Part.

(3) The Bank may impose requirements about—

(a) the nature of the expert to be appointed;

(b) the content of the report;

(c) treatment of the report (including disclosure and publication);

(d) timing.

206R Compliance failure U.K.

In this Part “compliance failure” means a failure by a recognised person to—

(a) comply with a code of practice under section 206L,

(b) comply with a direction under section 206M, or

(c) ensure compliance with a requirement under section 206Q (independent reports).

206S Publication U.K.

The Bank of England may publish details of—

(a) a compliance failure by a recognised person;

(b) a sanction imposed under sections 206T to 206V.

206T Penalty U.K.

(1) The Bank of England may require a recognised person to pay a penalty in respect of a compliance failure.

(2) A penalty—

(a) must be paid to the Bank, and

(b) may be enforced by the Bank as a civil debt owed to the Bank.

(3) The Bank must prepare a statement of the principles which it will apply in determining—

(a) whether to impose a penalty, and

(b) the amount of a penalty.

(4) The Bank must—

(a) publish the statement on its website,

(b) send a copy to the Treasury,

(c) review the statement from time to time and revise it if necessary (and paragraphs (a) and (b) apply to a revision), and

(d) in applying the statement to a compliance failure, apply the version in force when the failure occurred.

206U Closure U.K.

(1) This section applies if the Bank of England thinks that a compliance failure by a person recognised for the purposes of this Part as having systemic significance—

(a) threatens the stability of, or confidence in, the UK financial system, or

(b) has serious consequences for business or other interests throughout the United Kingdom.

(2) The Bank may give the person an order (a “closure order”) to stop performing specified relevant functions in relation to specified wholesale cash distribution activities—

(a) for a specified period,

(b) until further notice, or

(c) permanently.

(3) Before giving a closure order to a recognised person, the Bank must have regard to the public interest in the continued performance by the person of relevant functions (whether or not specified) in relation to wholesale cash distribution activities (whether or not specified).

(4) A recognised person who fails to comply with a closure order commits an offence.

(5) A person who commits an offence under this section is liable—

(a) on summary conviction in England and Wales, to a fine;

(b) on summary conviction in Scotland, to a fine not exceeding the statutory maximum;

(c) on summary conviction in Northern Ireland, to a fine not exceeding the statutory maximum;

(d) on conviction on indictment, to a fine.

(6) In this section, “specified” means specified in the closure order.

206V Management disqualification U.K.

(1) The Bank of England may by order prohibit a specified person from holding an office or position involving responsibility for taking decisions about the management of a recognised person—

(a) for a specified period,

(b) until further notice, or

(c) permanently.

(2) A person who breaches a prohibition under subsection (1) commits an offence.

(3) A person who commits an offence under this section is liable—

(a) on summary conviction in England and Wales, to a fine;

(b) on summary conviction in Scotland, to a fine not exceeding the statutory maximum;

(c) on summary conviction in Northern Ireland, to a fine not exceeding the statutory maximum;

(d) on conviction on indictment, to a fine.

(4) In this section, “specified” means specified in the order.

206W Warning U.K.

(1) Before imposing a sanction on a person the Bank of England must—

(a) give the person a notice (“a warning notice”),

(b) give the person at least 21 days from the date of the notice to make representations,

(c) consider any representations made, and

(d) as soon as reasonably practicable, give the person a notice stating whether the Bank intends to impose the sanction.

(2) In subsection (1), “imposing a sanction” means—

(a) publishing details under section 206S;

(b) requiring the payment of a penalty under section 206T;

(c) giving a closure order under section 206U;

(d) making an order under section 206V.

(3) Despite subsection (1), if satisfied that it is necessary, the Bank may without notice—

(a) give a closure order under section 206U, or

(b) make an order under section 206V.

206X Appeal U.K.

(1) Where the Bank of England notifies a person under section 206W(1) that it intends to impose a sanction, the person may appeal to the Upper Tribunal.

(2) Where the Bank imposes a sanction on a person without notice in reliance on section 206W(3), the person may appeal to the Upper Tribunal.

(3) The Bank of England may not impose a sanction while an appeal under this section could be brought or is pending.

206Y Injunctions U.K.

(1) If, on the application of the Bank of England, the court is satisfied—

(a) that there is a reasonable likelihood that there will be a compliance failure, or

(b) that there has been a compliance failure and there is a reasonable likelihood that it will continue or be repeated,

the court may make an order restraining the conduct constituting the failure.

(2) If, on the application of the Bank of England, the court is satisfied—

(a) that there has been a compliance failure by a recognised person, and

(b) that there are steps which could be taken for remedying the failure,

the court may make an order requiring the recognised person, and any other person who appears to have been knowingly concerned in the failure, to take such steps as the court may direct to remedy it.

(3) If, on the application of the Bank of England, the court is satisfied—

(a) that there may have been a compliance failure by a recognised person, or

(b) that any other person may have been knowingly concerned in a compliance failure,

the court may make an order restraining the person from dealing with any assets which it is satisfied the person is reasonably likely to deal with.

(4) The jurisdiction conferred by this section is exercisable—

(a) in England and Wales and Northern Ireland, by the High Court;

(b) in Scotland, by the Court of Session.

(5) In this section—

(a) references to an order restraining anything are, in Scotland, to be read as references to an interdict prohibiting that thing;

(b) references to an order requiring steps to be taken are, in Scotland, to be read as references to an order for specific performance under section 45 of the Court of Session Act 1988;

(c) references to remedying a failure include mitigating its effect;

(d) references to dealing with assets include disposing of them.]