In mid-January, the Czech National Bank fined Česká spořitelna CZK 2.75 million for misconduct in telephone calls offering investment services and in providing services for funds. The savings bank respects the sanction and has corrected the shortcomings, its spokesman said. Hospodarske noviny (HN) reported today.
According to the CNB, the savings bank erred by failing to keep all records of telephone calls with potential investors and by failing to ensure a system of record keeping that would prevent manipulation. The CNB also cited similar misconduct with respect to the bank’s offerings for corporate clients, where, for example, employees of the savings bank were not required to keep records of personal meetings with customers regarding investment services.
The second area where the central bank said there were shortcomings was in the provision of services to funds. “As of February 14, 2019, it did not properly perform the control duties of an investment fund depositary,” the CBR wrote in its decision on the savings bank. For example, the CNB said that for the Investika real estate open-end mutual fund, the savings bank failed to check whether the current value of the unit trust was properly calculated and the assets and debts of the fund were valued. For example, the savings bank also did not check whether the fund complied with the investment limits.
“We respect the CNB’s decision and the amount of the fine. We have promptly corrected the deficiencies on the basis of which it was imposed and paid the money,” HN quotes Česká spořitelna spokesman Filip Hrubý as saying. According to him, the CNB significantly reduced the fine. The central bank had originally levied a three-million-dollar penalty.
The CNB has long been dealing with problems with the recording of communications with customers. It has imposed fines of over CZK 1 million on Komerční banka and Fincentrum. “In the past, the Czech National Bank has noted difficulties in fulfilling the recording obligation by some financial institutions providing investment services,” said central bank spokeswoman Petra Vlčková.
In the past year, the CNB imposed unusually high monetary penalties, especially for fees and interest costs charged by financial institutions to clients for early repayment of mortgages. UniCredit Bank was fined CZK 10 million for this, Komerční banka had to pay CZK 7.5 million in the middle of last year. At the beginning of last year, the central bank imposed a CZK 5 million fine on the Modrá pyramida building society, which belongs to the Komerční banka group, for similar misconduct.
Source: Hospodarske noviny and CTK
