Administrative penalties for violations of regulations on responsibilities of depository bank in Vietnam

According to Article 32 of Decree No. 108/2013/NĐ-CP of Vietnam’s Government, administrative penalties for violations of regulations on responsibilities of Supervisory bank, depository bank are specified as follows:

- A fine of between VND 50,000,000 and 70,000,000 shall be imposed on Supervisory bank, depository bank conducting any of the following violations:

+ Failing to properly and fully perform its obligations as prescribed in the supervision or depository contract, the fund charter and by law;

+ Failing to make and archive dossiers and documents under regulations; failing to record in an accurate and detailed manner transactions of a fund management company, investment fund, entrusting investor or securities investment company in accordance with law;

+ Failing to supply timely, sufficient and accurate information to fund Management Company, audit organization as prescribed by law;

+ Failing to ensure that division of providing services for valuating net assets employs staff possessing the audit or accounting practice certificates in accordance with law;

+ Failing to formulate process of operation and risk control to ensure fulfilling obligations as prescribed by law.

- A fine of between VND 70,000,000 and 100,000,000 shall be imposed on depository bank conducting any of the following violations:

+ Failing to conduct timely and accurate collection, payment, settlement and transfer of money and securities under regulations;

+ Paying for transactions not in accordance with the fund charter, entrustment contract and depository contract;

+ Failing to properly, adequately and promptly execute orders or other lawful instructions of the fund management company and supervisory bank and to exercise rights arising in exercising rights and performing obligations related to the ownership of assets of the investment fund, securities investment company or trusting investor;

+ Failing to adequately, accurately and promptly implement regulations on asset liquidation and plans on handling of remaining assets; failing to report to the State Securities Commission on necessary information relating to investment fund dissolution.

- A fine of between VND 100,000,000 and 150,000,000 shall be imposed on depository bank conducting any of the following violations:

+ Failing to put into the depository and separate assets of each investment fund or securities investment company, of each entrusting customers from assets of bank in accordance with law;

+ Using money and assets of investment fund, securities Investment Company, or entrusting investor for improper purpose, in contravention with fund’s charter, depository contract and law.

View more details at Decree No. 108/2013/NĐ-CP of Vietnam’s Government, effective from November 15, 2013.

Ty Na

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