On 21 April, the Bermuda Monetary Authority (BMA) published a consultation paper on “Proposed Enhancements to Supervisory Powers within the Investment Funds Act 2006”.
Recent legislative amendments to the investment funds regime enhanced certain prudential requirements, and the BMA wants to ensure it continues to possess a range of supervisory powers to apply should regulatory breaches of any scale occur. The BMA’s proposals are intended to enhance its ability to safeguard participants’ interests through targeted corrective actions when breaches of the regulatory requirements are identified, and thereby maintain Bermuda’s reputation as a well-regulated jurisdiction for conducting investment fund business.
These proposals include requiring Professional Class A, Class B and Closed Funds to prepare financial reports that contain audited financial statements. The proposals would also give the BMA power to impose penalties not exceeding $1,000 for each month or part of a month that an investment fund fails to comply with certain requirements or to impose penalties ranging from $3,000 to $10,000 for each month or part of a month where an operator fails to prepare a financial report as required by the Investment Funds Rules 2019 (as proposed to be amended).
The consultation paper and detailed appendices are available on the BMA website.
All stakeholders are invited to comment on the proposals on or before 19 May 2023. Comments, and any questions regarding the rationale, scope or application of the proposed powers, should be submitted to [email protected]