The Central Bank may increase fines for imposing services by banks – Kommersant

Chairman of the Bank of Russia Elvira Nabiullina said that this fall the regulator may for the first time oblige individual banks to stop selling certain products to individuals and demand their buyback. The Central Bank may also increase fines for imposing services several times over.

“We have the right to suspend the sale of certain products and demand a buyback if these products were sold in bad faith. In the spring, we identified a number of violations in the sale of insurance and investment products by banks. Especially in large banks. And we will repeat these checks in the fall,” Ms. Nabiullina said at the XX International Banking Forum (quoted from RIA Novosti).

According to her, if violations in the sale of insurance and investment products are identified again, the Central Bank will exercise its right to “apply tough measures” to financial organizations. The head of the regulator did not specify which products banks may be prohibited from selling.

Elvira Nabiullina also said that the Central Bank is now preparing legislative proposals to increase fines for banks for imposing financial services (misselling). She said that the Bank of Russia is recording an increase in complaints about such violations and considers it necessary to make changes to the legislation. “We are now preparing proposals for a bill that will increase fines for this kind of thing by multiples,” said the head of the regulator.

Currently, the Bank of Russia for such violations can impose a fine of up to 0.1% of capital, but not less than 100 thousand rubles. If the Central Bank’s order is not fulfilled on time or the violations create a real threat to the interests of creditors (depositors), the fine increases to 1% of the bank’s capital, but must be at least 1 million rubles.

Alexander Kislov