fp Turks and Caicos

The Financial Services Commission has published a five-year plan that proposes improvement to its role of supervising insurance, securities, trusts and banks, including a deposit insurance ordinance.

No details of the deposit insurance ordinance are included in the plan.

The lack of deposit insurance caused most depositors in the Turk and Caicos Islands Bank Ltd. to lose nearly all of their money when the local institution was closed in April 2010 by the FSC. Liquidation is still ongoing, but customers hold little hope of recovering most of their losses.

An FSC report said the bank’s senior management caused the small indigenous bank to fail, but the FSC should have stepped in sooner to correct years of persistent problems.

That report, plus recent reviews by the International Monetary Fund, the Toronto Centre and the Caribbean Financial Action Task Force, pointed out shortcomings of the FSC and what was needed to solve problems and meet international standards. A draft plan including those recommendations was presented Feb. 17 to stakeholders including the Bankers Association, Association of Licensed Trustees, the Insurance Managers Association and the Insurance Association.

The plan announced April 25 will be available on the FSC’s website (www.tcifsc.tc) and be periodically updated.

“The Action Plan is the culmination of a great deal of work by the FSC and its partners in the financial services sector, and represents a summary of our objectives for the next five years,” said FSC Chairman Errol Allen. “Completion of these objectives will provide the TCI with an extremely robust and practical legislative and regulatory framework designed to support the industry into the future.”

The plan calls for improved reporting, more staff and training for the FSC, and a number of new laws. For banking and trusts, new legislation will include the Financial Services Commission Ordinance, Banking Ordinance, Bank Insolvency Ordinance, Deposit Insurance Ordinance and Trustees Ordinance, according to the plan.

The FSC has transferred its Banks and Trusts department and the Finance and Administration department to its Providenciales offices, and has begun relocating its Insurance department.

“The Action Plan charts a positive way forward for the sector and describes the steps that will be taken to ensure the TCI keeps pace with the latest international regulatory standards,” His Excellency the Gov. Ric Todd said in the announcement. “I am sure the private sector will rise to the challenges ahead and work with the FSC to ensure that TCI’s reputation as a financial services centre is enhanced.”

Read the FSC’s Action Plan on its website at www.tcifsc.tc.