COMMUNICATION "A" 6421 03/01/2018

TO:

• Exchange houses, exchange agencies and exchange offices
• Non‑financial companies issuing credit cards
• Administrators of credit portfolios of ex‑financial entities
• Trustees of financial trusts covered by the Law on Financial Entities
• Electronic compensation chambers
• Representatives of foreign financial entities not authorized to operate in the country
• Non‑financial companies issuing purchase cards
• Valuables carriers

Reference: Circular RUNOR 1‑1367

"Disciplinary Regime under the Central Bank of the Argentine Republic, Laws 21.526 and 25.065 and their amendments"

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We address you to inform that this Institution has adopted the following resolution:

1. Replacement of point 1.2.2 of Section 1 and point 3.9 of Section 3

1.2.2. The trial of alleged minimum‑gravity infractions shall be conducted summarily; once the formal opening of the summary is ordered, no prior or special pronouncements shall be admissible. After the charges are served, the deadline to submit defenses, offer evidence and attach documentation shall be five (5) days. Once the defense is produced, the deadline expires, or the pertinent admissible evidence is produced, a period of five (5) days shall be granted for the summoned parties to file a pleading; after such filing or after the lapse of that period, the Superintendent of Financial and Exchange Entities shall adopt a resolution.

3.9. The procedure provided in this regulatory framework is optional and instituted for the benefit of the sanctioned party, to facilitate compliance with the monetary sanction imposed. The first effect is the suspension of fiscal execution, for which the sanctioned party must appear at the time indicated to sign a document requesting a suspension of procedural deadlines for 35 business days. Authorization for such suspension shall be understood as granted by the BCRA Board of Directors, in the terms of article 157 of the National Civil and Commercial Procedural Code, to the BCRA representatives acting in each process.

• Consequently, all deadlines set shall be peremptory, all orders issued shall be irrecurrable, and any request not answered within ten (10) business days of its submission shall be deemed tacitly denied.
• The procedural impetus rests with the sanctioned party, who must initiate the procedure such that if the agreement is not concluded within 45 business days of its original submission, a complete copy of the file shall automatically be forwarded to the Main Legal Affairs Management so that it has all necessary data to start or continue fiscal execution.

2. Replacement of Section 5 (Recourse Routes)

Section 5. Recourse Routes.

The admissible recourse routes for sanctions resolved under article 41 of the Financial Entities Law (LEF) shall be those provided in article 42 of the same legal body, the Law 19.549 on Administrative Procedures and its regulatory decree (t.o. 1991) not being applicable.

• Sanctions of “warning” and “reprimand” listed in items 1) and 2) of article 41 LEF are only revocable before the Superintendent of Financial and Exchange Entities.
• Sanctions listed in items 3), 4), 5) and 6) of the same article are appealable, for devolutive effect only, before the National Chamber of Appeals in Federal Administrative Litigation.
• In the case of item 6), until the appeal is resolved, that Chamber shall order judicial intervention of the entity, substituting the legal representatives in their rights and powers.
• Appeals must be filed and substantiated before the BCRA within fifteen (15) business days from the date of notification of the resolution. If the appeal is of the appellate type, the proceedings shall be elevated to the Chamber within the following fifteen (15) business days.

3. Replacement of points 8.1 and 8.2 of Section 8

8.1. Exceptional Circumstances and Cases.
Only in exceptional cases may the resolving instance apply criteria that deviate from those established in this regime, duly attenuating or aggravating sanctions, among other things, in particular cases that do not fit within the present norm. Such criteria must necessarily be applied in accordance with the circumstances of the case, the general principles of law applicable and constitutionally recognized guarantees, preventing arbitrary discrimination.

8.2. Sanction Unit.

• The measurement unit called "Sanction Unit" is created, which will amount to ARS 50,000 (fifty thousand pesos) for the whole year 2017.
• The value of the Sanction Unit applicable in each calendar year shall be determined by the BCRA Board of Directors at its first board meeting of the respective year and shall be published through Communication "B".
• Monetary fines shall be calculated using the value of the Sanction Unit in force at the time the sanctioning resolution is issued by the BCRA and shall be expressed in pesos.

4. Replacement of numerous points of Section 9 (Infractions and Penalties)

Code	Description	Severity	Amount 1	Amount 2
9.8.1	Absence of relevant working papers concerning internal control and external audit reports.	High	150	75
9.8.2	Irregularities or breaches detected and not included or not mentioned in external audit reports.	High	150	75
9.9	Rules on internal control, internal audit and risk management.
9.9.1	Absence of relevant working papers concerning internal control and internal audit reports.	High	150	75
9.9.4	Failures or weaknesses in management and/or internal control.	High	300	N/A
9.11.1	Non‑compliance with rules on opening, enabling or closing branches, other dependencies and offices, and installation of ATMs and other devices.	Medium	70	35
9.11.2	Other non‑compliances with rules on expansion of financial and exchange entities not covered in other points.	Medium	50	25
9.12.1	Non‑compliance with rules on share transfers that imply a change in control of the social will, in shareholder groups and/or in their qualifications, or that require identification of the ultimate beneficiary according to UIF thresholds.	High	150	75
9.12.2	Non‑compliance with rules on prior authorization of members of the administration, supervision and/or general management bodies of financial entities.	High	150	N/A
9.12.4	Non‑compliance with rules on modifications in the composition of the share capital of entities that do not entail a change in control of the social will, in shareholder groups and/or in their qualifications.	Medium	70	N/A
9.12.5	Holding meetings of the administration body without observing the minimum percentage of members with experience, as established according to the type of entity.	Medium	50	N/A
9.14.2	Exceeding the maximum financing rates established by the Credit Card Law.	High	250	N/A
9.21	Valuables carriers.
9.21.1	Non‑compliances related to registration and documentation rules.	High	300	150
9.21.2	Non‑compliances related to minimum security measures rules.	High	200	100
9.21.3	Other non‑compliances with rules on valuables carriers.	Medium	60	30
9.9.5	Tasks of the Audit Committee not performed or performed improperly.	High	150	75
9.9.6	Other non‑compliances with minimum internal control and internal audit system rules provided in other points.	Medium	60	30
9.12.6	Non‑compliance with the requirements for presenting information and/or documentation and/or late presentation.	Low	2010	9
9.12.7	Other non‑compliances with norms relating to exchange transfers and non‑compliance of directors.	Low	1005	9
9.22.8	Borrower files with formal deficiencies that do not alter correct credit policy.	Low	5	N/A
9.22.9	Operations with common investment funds.	Medium	70	N/A
9.22.10	Non‑compliance with rules on payment of social security benefits by ANSES.	Medium	70	N/A

5. Incorporation of new points 9.9.5, 9.9.6, 9.12.6, 9.12.7, 9.22 and 9.22.1‑10 into Section 9

(The table above reflects the incorporated points and their corresponding penalties.)

Finally, we inform you that we will subsequently send the sheets that, in replacement of those previously provided, must be incorporated into the regulations on the "Disciplinary Regime under the Central Bank of the Argentine Republic, Laws 21.526 and 25.065 and their amendments".

Sincerely,

BANCO CENTRAL DE LA REPÚBLICA ARGENTINA

Rubén Darío Narduzzi – Chief Manager of Contentious Affairs

Néstor Daniel Robledo – Deputy General Manager of Compliance and Control