Regulatory Alerts2020-03-05
Instructions for Publishing Sanctions
The Saudi Central Bank (SAMA) issued these Instructions for Publishing Sanctions to mandate financing and refinancing companies to disclose monetary and non-monetary violations in their annual board of directors' reports. The circular requires companies to publish the violation subject, decision count, and total fine amounts in Saudi Riyals under a designated heading, effective from the 2020 financial year report. SAMA will cross-check these disclosures against its internal records, publish them on its official website, and enforce statutory procedures for non-compliance.
In the Name of Allah, the Most Gracious, the Most Merciful
Saudi Central Bank (SAMA)
Head Office
Office of the Deputy Governor for Supervision
No. :
Attachments :
Circular
Dear Sir/Madam,
Peace, mercy of Allah and His blessings be upon you,
Subject: Instructions for Publishing Sanctions.
Based on the powers granted to the Saudi Central Bank under the Financing Companies Supervision System issued by Royal Decree No. (M/51) dated 13/8/1437H and its Executive Regulations, and in light of the Bank's supervisory and regulatory role over financial institutions under its supervision, as well as its commitment to applying the principles of fairness and transparency to enhance confidence in the financial sector and enable data users and decision-makers, including investors, creditors, and customers generally, to review the sanctions imposed by the Bank due to violations of supervisory and regulatory systems and instructions, and based on the following:
- Paragraph (1) of Article (72) of the Executive Regulations for the Financing Companies Supervision System, which stipulates that "financing companies must notify the Bank of their annual financial statements, audit reports, and board of directors' reports at least five working days prior to their publication".
- Article (73) of the Executive Regulations for the Financing Companies Supervision System, which stipulates that "without prejudice to the requirements of other applicable systems, a financing company shall establish its own electronic website on the World Wide Web (Internet) through which it publishes ... 4. The Board of Directors' Report".
Therefore, the following must be adhered to:
First: Financing and refinancing companies shall publish in their annual board of directors' reports violations for which the Bank has issued executive decisions under the heading "Saudi Central Bank Executive Decisions", covering violations of the current financial year and previous financial years. The publication shall include the subject of the violation, the number of executive decisions (including monetary and non-monetary fines), and the total amount of monetary fines in Saudi Riyals, according to the format provided in the illustrative table below:
No. : 41047953
Date: 1441/07/10
Attachments: None
Note:
The date of the letter notifying the executive decision shall serve as the basis for the publication process.
Second: The subjects of violations are determined as follows:
- Violation of the Bank's supervisory and regulatory instructions.
- Violation of the Bank's instructions regarding customer protection.
- Violation of the Bank's instructions regarding due diligence in combating money laundering and financing of terrorism.
The Bank will compare the violations reported in the annual board of directors' reports of financing and refinancing companies with its records, publish these violations on the Bank's official website, and apply statutory procedures in case of non-compliance with these instructions.
For information and action, effective from the Board of Directors' report for the financial year 2020.
Yours sincerely,
Fahd bin Ibrahim Al-Shathri
Deputy Governor for Supervision
Distribution Scope:
- Financing and refinancing companies operating in the Kingdom
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| Subject of Violation | Number of Executive Decisions | Total Amount of Monetary Fines in Saudi Riyals | Number of Executive Decisions | Total Amount of Monetary Fines in Saudi Riyals |
|---|---|---|---|---|
| Violation of the Bank's supervisory and regulatory instructions | 3 | 1,500,000 | - | - |
| Violation of the Bank's instructions regarding customer protection | 5 | 20,000 | 6 | 3,000 |
| Violation of the Bank's instructions regarding due diligence in combating money laundering and financing of terrorism | - | - | - | - |
Note:
The date of the letter notifying the executive decision shall serve as the basis for the publication process.
Second: The subjects of violations are determined as follows:
- Violation of the Bank's supervisory and regulatory instructions.
- Violation of the Bank's instructions regarding customer protection.
- Violation of the Bank's instructions regarding due diligence in combating money laundering and financing of terrorism.
The Bank will compare the violations reported in the annual board of directors' reports of financing and refinancing companies with its records, publish these violations on the Bank's official website, and apply statutory procedures in case of non-compliance with these instructions.
For information and action, effective from the Board of Directors' report for the financial year 2020.
Yours sincerely,
Fahd bin Ibrahim Al-Shathri
Deputy Governor for Supervision
Distribution Scope:
- Financing and refinancing companies operating in the Kingdom
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