| 7.1 | In order to meet fit and proper requirements, an Authorized Individual or Material Risk Taker must have and demonstrate the necessary qualities that will allow him/her to perform the duties and carry out the responsibilities of his/her function within the Licensee. These qualities relate at a minimum to: honesty, integrity and reputation; competence and capability; good financial conduct; independence of mind and time commitment.
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| | Honesty, Integrity and Reputation
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| 7.2 | Authorized Individuals and Material Risk Takers must be honest, diligent, of good reputation and independent-minded, and act ethically and with integrity and fairness. The Person must, at all times, act in full compliance with their contract of employment, including adherence to the Licensee’s code of conduct and/or ethics. |
| 7.3 | The conduct and actions of the Person who is subject to the Fit and Proper Process must be such that his/her integrity is beyond reasonable doubt. Indicators of integrity include criminal, financial, supervisory and other aspects. |
| 7.4 | Supervisory indicators include information collected by supervisors, including the Central Bank in the performance of their duties. Negative indicators could include the withholding of information from competent authorities, submission of incorrect financial or other statements, prior refusal of regulatory approval, other corrective actions or interventions by a competent authority. |
| 7.5 | A Person must not be considered of good repute if their personal or business conduct gives rise to any material doubt about their ability to ensure the sound and prudent management of or participation in the Licensee. |
| 7.6 | In determining the honesty, integrity and reputation of a Person, consideration must be given to whether the Person:
| a. | has a record or evidence of previous conduct and activities where he/she has been convicted for a criminal offence under any legislation designed to protect members of the public from financial loss, due to dishonesty, incompetence, malpractice, misappropriation of assets, embezzlement and other fraud. | | b. | is or has been the subject of any adverse finding or any settlement in civil proceedings of an offence related to misconduct, misrepresentation, breach of trust, dishonesty, fraud, money laundering, theft, or other financial crime within the prior ten year period. | | c. | has at any time shown a strong objection or lack of willingness to cooperate with competent authorities resulting in a failure or potential failure to comply with legal obligations, regulatory or professional requirements and standards, including compliance with tax requirements and obligations, or has been obstructive, misleading or untruthful in dealing with competent authorities or a court. | | d. | has not been fair, truthful and forthcoming in dealings with customers, auditors and/or competent authorities. | | e. | has had any judgements or decisions issued against them by the courts, dispute resolution committees or other judicial or semi-judicial bodies; or has ever been disqualified or restricted from acting as a director or serving in a managerial capacity. | | f. | has been convicted or found guilty in any proceedings of a disciplinary, regulatory or criminal nature, including the practice of any unauthorised or unlicensed activity. | | g. | any entity in which the Person holds or has held any position of responsibility or influence or is or has been a significant shareholder, is or has been, subject to any disciplinary proceedings, civil penalty, enforcement action, has been suspended, or has been issued a censure, warning, reprimand or other administrative sanction or its equivalent, by the Central Bank, clearing house or exchange, or by any other competent authority, considering also the level of direct or personal involvement of the Person. | | h. | has contravened any of the material requirements of the Central Bank Laws or any of its Regulations or any equivalent requirements of another competent authority. | | i. | is or has been associated, in ownership, directorship or management capacity, with a company, partnership or other business association which is being or has been wound up by a court or other competent authority; that has been refused registration,authorisation, membership or a licence to conduct trade, business or profession; has been prohibited, restricted or suspended from the right to carry on any trade, business or profession for which a licence, registration or other authorisation is required by the law in that jurisdiction; or has had that registration, authorisation, membership or licence revoked, with drawn or terminated, or struck off the register of companies (or its equivalent) on an involuntary basis; and/or has been found to have contributed significantly to the failure of an organisation or a business unit, considering also the level of direct or personal involvement of the Person. | | j. | has been the subject of any complaint made to the Central Bank, the financial services ombudsman or any equivalent body, relating to activities regulated by the Central Bank or regulated by an equivalent competent authority. In considering whether the complaint adversely affects the Person’s ability to carry out a relevant function, consideration shall be given to the outcome of any inquiry or investigation or any similar process into that complaint if same has been concluded. | | k. | without prejudice to the presumption of innocence, has been the subject of any proceedings of a criminal or disciplinary nature or has been notified of any such potential proceedings or any investigation which may lead to such a proceeding. | | l. | has been untruthful or provided false or misleading information to the Central Bank or has been uncooperative in any dealings with the Central Bank; | | m. | has at any time shown strong objection or a lack of willingness to maintain effective internal control systems and risk management practices. | | n. | has engaged in any business or professional practices which are deceitful, negligent, oppressive or otherwise improper (whether unlawful or not), or which otherwise reflect discredit on his/her professional conduct. | | o. | has been dismissed, asked to resign or has resigned from any profession, vocation, office or employment or from any position of trust or fiduciary appointment, whether or not remunerated because of questions about his/her honesty and integrity, or has breached a fiduciary obligation.
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| | Competence and Capability
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| 7.7 | An Authorized Individual or Material Risk Taker must have the necessary academic qualification, competence, capacity, theoretical knowledge, adequate experience and skills to perform his/her role effectively, as well as the ability to understand the technical requirements of the business of the Licensee, the legal and regulatory framework, the risks and the management process. Additionally, the Person must meet all requirements set by the Central Bank, which may include specific qualification, academic, or training requirements related to the specific function the Person holds or is being proposed to assume. |
| 7.8 | In determining the competence and capability of a Person, a Licensee must consider and assess whether the Person:
| a. | has the appropriate professional or other qualifications, training and capability to demonstrate their capacity to undertake the responsibilities of the positions and more generally, their suitability for the relevant function. | | b. | has the competence, proficiency and an appropriate range of skills and experience to understand, operate and manage the affairs of the Licensee and to effectively and efficiently fulfil the role and responsibilities of the function. | | c. | meets minimum qualification and training requirements established by the Central Bank, where applicable. | | d. | has an adequate number of years of relevant, practical experience. | | e. | has the technical knowledge and ability to perform prescribed duties for which they are engaged, specifically professional qualifications and membership in relevant professional bodies. The Licensee must take consideration of any specific, required experiences, skills and/or qualifications for key functions. | | f. | has a sound knowledge of the business of the Licensee as a whole, and the specific responsibilities that are to be undertaken in the relevant function. | | g. | has satisfactory past performance or expertise in the nature of the business being conducted and history of compliance with the law and Regulations. | | h. | has a clear and comprehensive understanding of the legal and regulatory environment relevant to the function. | | i. | is of sound mind. | | j. | has been dismissed or suspended from employment.
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| 7.9 | Additionally, Authorized Individuals and Material Risk Takers should demonstrate theoretical knowledge and understanding in some of the following areas:
| a. | the financial sector and financial markets; | | b. | the legal and regulatory framework, including Shari’ah requirements, where Shari’ah is applicable; | | c. | financial sector risks, risk management and internal controls; | | d. | climate and environmental risks; | | e. | environmental, social and governance (ESG) and sustainability factors; | | f. | corporate governance; | | g. | strategic planning; | | h. | accounting, auditing and financial statement analysis; and | | i. | the business, financial and economic environment.
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| | Financial Conduct
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| 7.10 | In assessing the financial conduct of Persons, the Licensee must assess whether the Person can maintain solvency and prudent financial control, including but not limited to, meeting liabilities as they become due. |
| 7.11 | A Person's financial conduct is relevant to an assessment of his/her professional integrity as it may have an impact on his/her reputation. |
| 7.12 | In assessing the financial conduct of a Person, the Licensee must give due consideration to whether the Person:
| a. | has the experience needed to manage their financial obligations and affairs prudently and properly. | | b. | can be reasonably expected to meet debts as they fall due. | | c. | has been subject to any judgment, debt or award that they have defaulted on, remainsouts tanding or has not been satisfied within a reasonable period of time. | | d. | has sought relief for any debt or made arrangements with creditors or made an assignment for the benefit of creditors, filed for bankruptcy or been adjudged bankrupt or had assets sequestered or confiscated or been in any proceedings related to any of the aforementioned. | | e. | has been able to provide the Licensee with satisfactory credit reference/s, where applicable. | | f. | is or has been unable to fulfil their financial obligations as they fall due; | | g. | has seriously or persistently failed to manage personal debts or financial affairs in a satisfactory manner that has caused detriment or loss to others. | | h. | has held in the past year or currently holds a loan or other credit facility with the Licensee which has been or is in arrears for a period of greater than ninety (90) days. | | i. | was able to manage any previous business dealings in a sound and prudent manner. | | j. | has been an owner, director, partner, senior manager or otherwise involved in the management of an entity that has gone into receivership, insolvency, or compulsory liquidation while the Person was connected with that entity or within a reasonably short period (for example, one year) after the Person’s departure from the institution.
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| | Independence of Mind
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| 7.13 | Authorized Individuals and Material Risk Takers must demonstrate the capacity to employ independent judgement and make sound, objective and independent decisions, without being unduly, externally influenced. The assessment of independence of mind must consider whether the Person has the ability to express divergent opinions and resist groupthink. The Person should show a record of being able to question and challenge members of Senior Management and the Board. |
| 7.14 | Authorized Individuals and Material Risk Takers must be assessed as independent from influence in performing their duties to the Licensee, giving due consideration to any other employment interests, obligations or situations which may give rise to a Conflict of Interest or which could, in any way, impair the Person’s ability to independently perform the duties.. |
| 7.15 | Licensees must assess whether the Person’s membership in other boards of directors or similar positions has the potential to conflict with the interests of the Licensee. |
| 7.16 | The Licensee must not allow for Persons to conduct concurrent responsibilities which have the potential to impair their ability to discharge the duties of the Designated Function. Where not already set in existing Regulations, the Licensee must set reasonable limits on the number of memberships held by members of the Board in other boards of directors or similar positions. |
| 7.17 | Licensees must conduct thorough assessments of whether a Person is involved in any business or other relationship which could materially pose a Conflict of Interest or interfere with the exercise of his/her judgement and has the potential to be disadvantageous to the interests of the Licensee. |
| 7.18 | The Licensee must not allow for a Person to simultaneously hold two or more positions within the Licensee where the appointments could result in a material conflict. |
| 7.19 | All financial and non-financial interests that could create potential or perceived Conflicts of Interest should be disclosed by the Licensee to the Central Bank as part of the application for Authorisation. The Licensee should notify the Central Bank about any material Conflicts of Interest, when they arise along with details of the proposed resolution plan.
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| | Time Commitment
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| 7.20 | Licensees must ensure that a Person has adequately demonstrated their ability to commit time to perform their role and meet the responsibilities associated with their function in the Licensee, by assessing the following, at a minimum:
| a. | whether the Person is in full time employment and assessing the number of hours or days dedicated to each role; | | b. | whether any of the roles have any additional responsibilities such as membership and/or chair of committees; | | c. | whether the nature, type and size of the other entity/entities will demand more time from the Person (e.g. the entity is regulated, listed etc.); and | | d. | whether the experience of the Person, either generally or with respect to the Licensee, is such that the Person could carry out their duties with greaterfamiliarity and therefore efficiency.
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| 7.21 | In order to ensure that time commitment is met by a Person, the Licensee must, at a minimum, request, review and submit to the Central Bank as part of its application for Authorisation, where applicable, the following:
| a. | a list of all of the other formal roles that the Person currently holds and the expected time commitment for each role; and | | b. | a declaration by the Person that they have sufficient time to dedicate to all the roles confirmed by the Licensee.
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