Cap. 645 Art. 26Administrative penalties and other measures. 

(1) The competent authority may impose administrative penalties and other administrative measures as referred to in sub-

article (3) where it deems that:

(a) a person’s conduct amounts to an infringement of any of the provisions of this Act or in any regulations made thereunder, or Credit Servicing Rules or Conduct of Business Rules issued thereunder;

(b) a person has contravened or failed to comply with any condition, obligation, requirement or directive made or issued by the competent authority in accordance with any of the provisions of this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct of Business Rules issued thereunder, including failure to co-operate with an investigation or an inspection or any request made by the competent authority in accordance with this Act.

(2) Without prejudice to the generality of sub-article (1), the competent authority may impose administrative penalties and other administrative measures as referred to in sub-article (3) where it deems that:

(a) a credit servicer enters into an outsourcing agreement infringing the provisions of article 13 or the credit service provider to whom the credit servicing activities were outsourced commits a serious infringement of the applicable legal provisions, including the provisions of this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct of Business Rules issued thereunder;

(b) a credit servicer’s governance arrangements and internal control mechanisms as set out in article 8(e) fail to ensure respect for borrower rights and compliance with personal data protection rules;

(c) a credit servicer’s policy is inadequate for the proper treatment of borrowers as set out in article 8(f);

(d) a credit servicer’s internal procedures as set out in article 8(g) fail to provide for the recording and handling of complaints from borrowers according to the obligations set out in this Act or in any regulations made thereunder, or Credit Servicing Rules or Conduct of Business Rules issued thereunder;

(e) a credit purchaser, or where applicable, its designated representative fails to communicate the information set out in articles 16 and 18;

(f) a credit purchaser or, where applicable, its designated representative fails to comply with the requirement of article 15;

(g) a credit purchaser fails to comply with the requirements of the provisions of article 17;

(h) a credit institution fails to communicate the information set out in article 14;

(i) a credit servicer allows one or more persons not complying with the requirements set out in article 8(b) to become or remain a member of its management or administrative organ;

(j) a credit servicer receives and holds funds from borrowers when it is not authorised to do so in accordance with this Act; and, or

(k) a credit servicer fails to comply with the requirements set out in article 12.

(3) Without prejudice to any other powers conferred to it by this Act or by any other law, the competent authority shall have the power to impose the following administrative penalties and measures for the infringements referred to in sub-articles (1) and (2):

(a) to withdraw or suspend an authorisation in accordance with article 9;

(b) to issue an order requiring the credit servicer or credit purchaser, or where applicable, its designated representative to remedy the infringement, and to cease such conduct and to desist from a repetition of said conduct; and, or

(c) to impose an administrative penalty which may not exceed one hundred and fifty thousand (€150,000) euro for each infringement or failure to comply, as the case may be.

(4) The administrative penalties and other administrative measures taken by the competent authority in terms of this article shall be effective, proportionate and dissuasive, and they shall be effectively implemented.

(5) The provisions of article 16(4) of the Malta Financial Services Authority Act shall apply, mutatis mutandis, with respect to any administrative penalty imposed by the competent authority in terms of this article.

(6) In the case of administrative penalties or other administrative measures imposed by the competent authority in accordance with the provisions of this Act or in any regulations made thereunder, or Credit Servicing Rules or Conduct of Business Rules issued thereunder, he competent authority, when determining the type of administrative penalty or other administrative measure and, where applicable, the amount of the administrative penalty, shall take into account relevant circumstances, including where appropriate:

(a) the gravity and the duration of the infringement;

(b) the degree of responsibility of the credit servicer or credit purchaser, or where applicable, its designated representative responsible for the infringement;

(c) the financial strength of the credit servicer or credit purchaser responsible for the infringement, including by reference to the total turnover of a legal person or the annual income of a natural person;

(d) the importance of profits gained or losses avoided because of the infringement by the credit servicer or credit purchaser or, where applicable, its designated representative responsible for the infringement, insofar as those profits or losses can be determined;

(e) the losses caused to third parties by the infringement, insofar as those losses can be determined;

(f) the level of cooperation by the credit servicer or credit purchaser responsible for the infringement with the competent authority;

(g) previous infringements by the credit servicer or credit purchaser or, where applicable, its designated representative responsible for the infringement;

(h) any actual or potential systemic consequences of the infringement.

(7) Without prejudice to the provisions of this article, where obligations imposed in terms of this Act or any regulations made thereunder, or Credit Servicing Rules or Conduct of Business Rules issued thereunder apply to a legal person, in the event of an infringement of any provision thereof, administrative penalties and other measures may also be imposed, subject to the conditions laid down in national law, on the members of the management or administrative body of the legal entity concerned, and on other individuals who are responsible for the infringement under national law.

(8) The imposition by the competent authority of an administrative penalty or any other administrative measure in terms of this article shall be without prejudice to any other consequence emanating from the act or omission of the offender in terms of civil or criminal law: Provided that in all cases where the competent authority imposes an administrative penalty or any other administrative measure in respect of anything done or omitted to be done by any person, and such act or omission also constitutes a criminal offence, no proceedings may be taken or continued against the said person in respect of such criminal offence.