Garda Síochána urges Ifsra to press ahead with tests

 

An Garda Síochána has urged the financial regulator to press ahead with its tough new regime to test the integrity and competence of directors and senior managers in the finance industry.

The force has also lobbied the Irish Financial Services Regulatory Authority to ensure that existing directors and managers should complete the proposed "fitness and probity tests".

In a response to the regulator's consultation on a proposed framework for tests, the force says it is vital that managers and directors of financial service firms are fit and proper persons with personal qualities such as honesty, integrity and fairness.

The financial regulator has proposed a new standardised test that all directors and senior managers will have to take to prove they have the competence and integrity to work in the industry.

The regulator has already proposed a new framework for the test and has sought a response from industry, consumers and relevant parties. The majority of the 24 responses were from the finance industry and urged the regulator to drop some of its more restrictive test proposals.

In contrast, An Garda Síochána is supportive of the scope of the framework for the tests and even urges the regulator to widen some of its tests, including a form that must be filled in by directors and mangers to certify fitness and probity for a position. "Existing directors and managers should be asked to complete the new form. It is vital that this be done otherwise a two-tier vetting system will be put in place which will compromise the whole system of regulation," says the paper.

The force also supports the extension of the system to managers below the level of the executive board, noting: "Experience has shown that fraudulent activity is not limited to the boardroom and in actual fact is often perpetrated at branch level manager level or below," it says.

Meanwhile, it also asks the regulator to expand its suitability checks to all shareholders, who may fall below the qualifying threshold but nevertheless influence the running of the company.

The paper also suggests that it may be worthy of consideration to frame a question in the tests that would seek to establish if an applicant was ever a director of a company that was struck off for failure to file annual returns.