Minister of State for Finance The Hon. Zhivargo Laing (left) announced that the Securities Commission of The Bahamas would be the inspector of Financial and Corporate Service Providers at a press conference at his office. Also pictured is Phillip Stubbs, the chairman of both the Securities Commission and the Compliance Commission. (Photo/Kristaan Ingraham)
By: Llonella Gilbert
NASSAU, Bahamas — The Bahamas Government is moving to amalgamate regulators into a single “super-regulator” or at least two regulators for the entire financial services sector, Minister of State for Finance the Hon. Zhivargo Laing said.
Mr. Laing said the Government has engaged an international consultant to assist with this endeavour and appointed a special committee of public and private sector experts to lead this process.
Therefore, he said, “I am pleased to advise that, in pursuit of our efforts to rationalise our regulatory regimes, so as to reduce overlap and duplication in the financial service sector, the government has agreed to appoint, effective 1st January, 2008, the Securities Commission as the Inspectorate of Financial Service Providers, pursuant to Section 12(1) of the Financial and Corporate Services Providers Act.”
This appointment results in the effective transfer of the administration of the Financial and Corporate Services Providers Act from the Registrar General’s Office to the Securities Commission, Mr. Laing explained at a press conference at his office Thursday, December 20, 2007.
There are five financial services regulators in the country – the Central Bank of The Bahamas, the Securities Commission, the Inspector of Financial and Corporate Service Providers, the Office of the Registrar of Insurance Companies and the Compliance Commission.
“At the moment,” Mr. Laing said, “all new clients and industry participants must apply, to, report to, interact with and observe regulations of these entities.
“In many instances each of these regulators has exacting demands that represent a duplication or replication of requirements for their constituents.”
He noted that this is not an ideal operating environment for industry participants who would much rather focus on pursuing their core business interest than having to fulfil similar requirements two and three times with the different agencies.
“Although the regulators have established a Memorandum of Understanding among themselves to help them cope with certain cross-cutting issues of our operators,” Mr. Laing said, “this is admittedly not sufficient to promote the optimal environment for competing in a globally competitive business such as financial services.”
The move being made by the government effectively reduces the regulatory entities from five to four.
Mr. Laing said the chairmanship of both the Securities Commission as well as the Compliance Commission, two critical and related regulatory functions, will fall under the leadership of Phillip Stubbs, retired managing partner of Ernst and Young.
Mr. Stubbs said the Securities Commission is pleased to be involved in this first step of the consolidation of the financial regulators.
He pointed out that the industry participants have been “clamouring” for the amalgamation for quite some time and all involved know that there will be challenges along the way.
Mr. Stubbs added, “However, the Securities Commission is committed to dealing and working with those challenges as it has done in the past and going forward as we get more involved next year in the execution of the consolidation of financial regulators.”