Regulatory Alerts2012-03-22
Banking Services for New Immigrants
The Supervisor of Banks mandates that banking institutions provide new immigrant customers with detailed explanations and native-language booklets regarding the nature, risks, and restrictions of requested financial transactions. This directive addresses previous compliance failures where immigrants executed orders or purchased securities without fully understanding the associated financial implications or account lock-in periods. The regulator retains authority to issue specific directives or grant exemptions to individual banking corporations when special circumstances warrant deviation from these standardized guidelines.
Supervisor of Banks: Proper Conduct of Banking Business [4] (12/20) Banking Services for New Immigrants Page 406- 1 ONLY THE HEBREW VERSION IS BINDING Banking Services for New Immigrants Introduction
- (a) There have been instances in which clerks of banking corporation did not give sufficient attention to the need to explain banking operations they had been asked to perform to customers who are new immigrants. (b) Despite the fact that the customers signed the execution orders, it transpired that they did not have sufficiently clear and specific information about the significance, restrictions, and risks associated with the transactions implemented in accordance with their instructions. (c) In some cases new immigrant depositors signed orders to purchase securities without having been given adequate information about the risks involved in the investment. In others, money was deposited in savings schemes, tying it up for at least two years, without the depositor receiving a clear explanation of what this involved. Guidelines for employees
- The attention of the employees in the branches should be brought to the need to give as detailed an explanation as possible of the significance of the transaction that a customer wishes to undertake in a banking corporation. Explanations for immigrants
- In view of the aforesaid, it is suggested that attention be paid to new immigrant customers, and that they should be provided with an explanatory booklet in their own language regarding the nature and main features of the transactions they wish to undertake.
Supervisor of Banks: Proper Conduct of Banking Business [4] (12/20) Banking Services for New Immigrants Page 406- 2 ONLY THE HEBREW VERSION IS BINDING Application 4. The Supervisor may establish certain directives that differ from the provisions detailed herein, which will apply to a specific banking corporation, or may exempt, in anomalous cases, a specific banking corporation from a certain directive, when there are special reasons due to which the Supervisor saw fit to do so, and for grounds that will be listed.
Updates Circular no. 06 Version Details Date 591 Original circular November 12, 1974 ---- 1 Insertion into Proper Conduct of Banking Business Directives August 1991 1620 2 Update January 31, 1993 ---- 3 Updated file of Proper Conduct of Banking Business Directives December 1995 2637 4 Update December 30, 2020