SocGen ordered to suspend some operations in Japan
17 Oct 2012
Japan's Financial Services Agency ordered Société Générale Private Banking Japan Ltd. to suspend some of its operations after it found the company had committed "serious violations of laws and regulations", including violating the duty of due care in the pension trust business.
In a recent inspection, the Japanese regulator also found the company hasn't developed an appropriate system of checks-and-balances over the private banking division, the FSA said in a statement. The company will have to halt certain operations in its pension trust business in Japan from 23 Oct. to 22 Jan. and suspend some of its private banking activities from 23 Oct. to 22 Nov., it added.
The FSA also found problems related to the governance system as well as the legal compliance and customer protection management systems, according to the statement.
The company has been ordered to take some measures to rectify the violations. These include clarifying the responsibility of the management, review the governance system, strengthen the functions of the audit committee and the internal audit division.
It also needs to drastically restructure the compliance system and the customer protection management system, including the review of the management systems regarding the pension trust business and the private banking business and steady implementation of revisions.
In addition, the company must make sure that all executives and employees fully understand and comply with laws, regulations and rules, and train, retain and appropriately allocate personnel necessary for its business operations.
It must also formulate a business improvement plan to implement the measures specified, submit a report of the plan and promptly implement it, the FSA stated.
Author: Penny Leung