XN000022-1989-07-12 — Page 4

WEDNESDAY, JULY 12, 1989

"IT IS TRUE THAT THESE DEFENCES ARE NOT DESIGNED SPECIFICALLY BANK TRANSACTIONS. BUT THE CLAUSE IS NOT DIRECTED SOLELY AT THE BANKS," MR BARNES EXPLAINED.

FOR

NEVERTHELESS, RECOGNISING THAT BANKS AND DEPOSIT-TAKING COMPANIES WOULD BE A MAJOR GROUP OF INSTITUTIONS TO BE AFFECTED, THE HONG KONG ASSOCIATION OF BANKS AND THE HONG KONG DEPOSIT-TAKING COMPANIES ASSOCIATION, WORKING CLOSELY WITH THE

ADMINISTRATION, HAD DRAWN UP MODEL GUIDELINES WHICH WOULD BE RECOMMENDED TO THEIR MEMBER INSTITUTIONS.

"THESE GUIDELINES AIM TO ENSURE THAT INTERNAL PROCEDURES ARE IN PLACE FOR INDIVIDUAL STAFF MEMBERS TO REPORT TO THE MANAGEMENT TRANSACTIONS WHICH ARE SUSPECTED OR BELIEVED TO BE DRUG RELATED, MR

BARNES SAID.

"

"IF THE SUSPICION OR BELIEF IS SHARED BY THE MANAGEMENT, AS REPRESENTED BY COMPLIANCE OFFICERS, IT WILL BE FURTHER REPORTED TO THE AUTHORITIES.

"

'WHERE SUCH GUIDELINES ARE IN PLACE IN AN INSTITUTION AND AN EMPLOYEE HAS FOLLOWED THEM IN GOOD FAITH, BUT A TAINTED TRANSACTION HAS NEVERTHELESS NOT BEEN RELAYED TO THE AUTHORITIES, THERE WOULD BE A GOOD CASE FOR HIM, IF INDEED HE WAS PROSECUTED AT ALL, TO INVOKE THE DEFENCE THAT HE HAD REASONABLE EXCUSE FOR FAILING TO REPORT SUCH CIRCUMSTANCES, HE EXPLAINED.

H

THE SECRETARY FOR SECURITY SAID THE ATTORNEY GENERAL INDICATED THAT REGARD WOULD BE GIVEN TO THE EXISTENCE AND CONTENT THE MODEL GUIDELINES WHEN CONSIDERING WHETHER TO PROSECUTE INDIVIDUAL CASES.

HAD

OF IN

"BUT IT IS, OF COURSE, NOT POSSIBLE TO FETTER THE DISCRETION OF THE ATTORNEY GENERAL WHETHER OR NOT TO PROSECUTE," MR BARNES STRESSED.

ON A POINT RAISED THAT THE MODEL GUIDELINES DRAWN UP BY THE TWO ASSOCIATIONS SHOULD BE REFERRED TO IN THE LEGISLATION, MR BARNES SAID IT WOULD BE VERY DIFFICULT TO DEVISE A LEGISLATIVE SCHEME HAVING REFERENCES TO SUCH GUIDELINES WHICH COULD APPLY TO ALL PARTIES THAT MIGHT BE AFFECTED BY CLAUSE 25 OF THE BILL, AND WHICH WOULD NOT SIGNIFICANTLY IMPAIR THE EFFECTIVENESS OF THE LEGISLATION.

ON

THE NEED FOR SPECIFIC DEFENCES FOR COMPLIANCE OFFICERS AND THE BANKS THEMSELVES, MR BARNES SAID: "I DO NOT THINK IT NECESSARY ΤΟ PROVIDE ANY STATUTORY DEFENCE FOR THE COMPLIANCE OFFICER BECAUSE HE IS NOT A PERSON WHO WOULD ENTER INTO AN ARRANGEMENT AS SUCH AND HENCE WOULD NOT ATTRACT ANY LIABILITY, UNLESS COMPLICITY COULD BE PROVED ON HIS PART.

"FURTHERMORE, TO GIVE BLANKET IMMUNITY TO BANKS WHICH MIGHT BE TAINTED BY ANY OFFENCES COMMITTED BY COMPLIANCE OFFICERS WOULD BE UNSATISFACTORY, AS THIS WOULD CREATE A MAJOR LOOPHOLE, HAVING REGARD TO THE FACT THAT A COMPLIANCE OFFICER IS DESIGNATED BY THE INSTITUTION то REPRESENT THE MANAGEMENT, AND GIVEN THE GENERAL ABSENCE OF LIABILITY ON HIS PART.

"

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