The Austrian Financial Market Authority FMA welcomes yesterday’s move by the National Council to double the fines for financial offences. As a result of the increase, as of 1 May 2012 the FMA can, for example, impose fines of up to € 100,000 for unlawful conduct of business (previously € 50,000), while the maximum fines of € 150,000 (previously € 75,000) will apply in the case of violations of money laundering provisions and for the offence of market manipulation as defined in the Börsegesetz (BörseG; Stock Exchange Act). Other affected legislation includes: the Bankwesengesetz (BWG; Banking Act), the Bausparkassengesetz (BSpG; Building Society Act), the Zahlungsdienstegesetz (ZaDiG; Payment Services Act), the E-Geldgesetz (E-GeldG; Act on Electronic Money), the Finanzkonglomerategesetz (FKG; Financial Conglomerates Act), the Börsegesetz (BörseG; Stock Exchange Act), the Investmentfondsgesetz 2011 (InvFG 2011; Investment Fund Act), the Immobilien-Investmentfondsgesetz (ImmoInvFG; Real Estate Investment Fund Act), the Wertpapieraufsichtsgesetz 2007 (WAG 2007; Securities Supervision Act), the Pensions-kassengesetz (PKG; Pensionskasse Act), the Versicherungsaufsichtsgesetz (VAG; Insurance Supervision Act), the Betriebliche Mitarbeiter und Selbständigenvorsorgegesetz (BMSVG; Company Employee and Self-Employment Provisions Act), and the Ratingagenturenvollzugsgesetz (RAVG; Act Implementing EU Legislation on Ratings Agencies). The fines specified in these supervisory laws will also generally be doubled (e.g. € 60,000 instead of € 30,000).
“This is an important step in the right direction. The FMA has been arguing for more stringent fines for a long time. Particularly in the financial sector we need to have fines that really hurt, in order to achieve the necessary level of discipline and establish an effective deterrent,” FMA Executive Director Helmut Ettl stated. Fellow Executive Board member Kurt Pribil added, “There are also ongoing efforts at the European level to increase and harmonise sanctions, with demands for a Europe-wide uniform minimum level of the highest fines for certain offences.” This was urgently necessary, he further explained, in order to avoid the risk of supervisory and sanction arbitrage within Europe. Europe should not offer any opportunities for side-stepping to markets where regulation, supervision and sanctions are not as stringent as in other markets, the FMA Executive Directors maintained.
The FMA issued 224 official penal decisions in 2011, amongst which the average fine was for € 4,500 and the maximum fine amounted to € 36,000. Administrative penalties totalled € 1.3 million in 2011.
Journalists may address further enquiries to:
Klaus Grubelnik (FMA Media Spokesperson)
+43/(0)1/24959-5106
+43/(0)676/882 49 516