OpenLegislation

Section 66B Misconduct: action by the PRAF1C1C2

United Kingdom

(1)

For the purposes of action by the PRA under section 66, a person is guilty of misconduct if any of conditions A to C is met in relation to the person.

(2)

Condition A is that—

(a)

the person has at any time failed to comply with rules made by the PRA under section 64A, and

(b)

at that time the person was—

(i)

an approved person, F2...

(ii)

an employee of a F3... PRA-authorised person F4, or

(iii)

a director of a PRA-authorised person.

(3)

Condition B is that—

(a)

the person has at any time been knowingly concerned in a contravention of a relevant requirement by a PRA-authorised person, and

(b)

at that time the person was—

(i)

an approved person in respect of the performance of a relevant senior management function in relation to the carrying on by the PRA-authorised person of a regulated activity, F5...

(F6ii)

an employee of the PRA-authorised person F7, or

(iii)

a director of the PRA-authorised person.

(4)

In this section “relevant requirement” means a requirement—

(a)

imposed by or under this Act, F8...

(F9aa)

imposed by or under the Securitisation Regulations 2024, or

(b)

imposed by any F10qualifying provision specified, or of a description specified, for the purposes of this subsection by the Treasury by order.

(5)

Condition C is that—

(a)

the person has at any time been a senior manager in relation to a F11... PRA-authorised person,

(b)

there has at that time been (or continued to be) a contravention of a relevant requirement by the authorised person, F12...

(c)

the senior manager was at that time responsible for the management of any of the authorised person's activities in relation to which the contravention occurred F13, and

(d)

the senior manager did not take such steps as a person in the senior manager's position could reasonably be expected to take to avoid the contravention occurring (or continuing).

F14(6)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(7)

For the purposes of subsection (5)—

  • “senior manager”, in relation to a F15... PRA-authorised person, means a person who has approval under section 59 to perform a designated senior management function in relation to the carrying on by the authorised person of a regulated activity;

  • F16...

(8)

In this section—

  • “approved person”—

    1. (a)

      means a person in relation to whom—

      1. (i)

        the PRA has given its approval under section 59, or

      2. (ii)

        the FCA has given its approval under section 59 in respect of the performance by the person of a relevant senior management function in relation to the carrying on by a PRA-authorised person of a regulated activity, and

    2. (b)

      in relation to an authorised person, means a person in relation to whom approval under section 59 is given on the application of the authorised person;

  • F17“director”, in relation to an authorised person, has the same meaning as in section 64A;

  • “employee”, in relation to a person, has the same meaning as in section 64A;

  • F18...

  • “relevant senior management function” means a function which the PRA is satisfied is a senior management function as defined in section 59ZA (whether or not the function has been designated as such by the FCA).

F19(9)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Annotations

Textual amendments

F1

Ss. 66A, 66B inserted (7.3.2016 for specified purposes, 10.5.2016 in so far as not already in force) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 32(2), 148(5); S.I. 2015/490, art. 2(1)(e) (as inserted by S.I. 2015/2055, art. 2(4) and with savings and transitional provisions in S.I. 2015/492 (as amended by S.I. 2015/1660)); S.I. 2016/568, art. 2

F2

Word in s. 66B(2)(b)(i) omitted (6.7.2016) by virtue of Bank of England and Financial Services Act 2016 (c. 14), ss. 25(3)(a), 41(3); S.I. 2016/627, reg. 2(1)(s)

F3

Word in s. 66B(2)(b)(ii) omitted (13.9.2018 for specified purposes, 10.12.2018 for specified purposes, 18.7.2019 for specified purposes, 9.8.2019 for specified purposes, 9.12.2019 for specified purposes, 7.12.2020 in so far as not already in force) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 4 para. 17(2); S.I. 2018/990, reg. 2(1)(2)(3) (with regs. 3-6); S.I. 2019/1136, reg. 2(2)(3)(4)(5) (with regs. 3-5, 7)

F4

S. 66B(2)(b)(iii) and word inserted (6.7.2016) by Bank of England and Financial Services Act 2016 (c. 14), ss. 25(3)(b), 41(3); S.I. 2016/627, reg. 2(1)(s)

F5

Word in s. 66B(3)(b)(i) omitted (6.7.2016) by virtue of Bank of England and Financial Services Act 2016 (c. 14), ss. 25(3)(c), 41(3); S.I. 2016/627, reg. 2(1)(s)

F6

S. 66B(3)(b)(ii) substituted (13.9.2018 for specified purposes, 10.12.2018 for specified purposes, 18.7.2019 for specified purposes, 9.8.2019 for specified purposes, 9.12.2019 for specified purposes, 7.12.2020 in so far as not already in force) by Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 4 para. 17(3); S.I. 2018/990, reg. 2(1)(2)(3) (with regs. 3-6); S.I. 2019/1136, reg. 2(2)(3)(4)(5) (with regs. 3-5, 7)

F7

S. 66B(3)(b)(iii) and word inserted (6.7.2016) by Bank of England and Financial Services Act 2016 (c. 14), ss. 25(3)(d), 41(3); S.I. 2016/627, reg. 2(1)(s)

F8

Word in s. 66B(4) omitted (30.1.2024 for specified purposes, 1.11.2024 in so far as not already in force) by virtue of The Securitisation Regulations 2024 (S.I. 2024/102), reg. 2(1)(e)(2), Sch. 1 para. 4(a) (with Sch. 3); as amended by S.I. 2024/705, regs. 1(2), 2(2)

F9

S. 66B(4)(aa) inserted (30.1.2024 for specified purposes, 1.11.2024 in so far as not already in force) by The Securitisation Regulations 2024 (S.I. 2024/102), reg. 2(1)(e)(2), Sch. 1 para. 4(b) (with Sch. 3); as amended by S.I. 2024/705, regs. 1(2), 2(2)

F10

Words in s. 66B(4)(b) substituted (31.12.2020) by The Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019 (S.I. 2019/632), regs. 1(3), 28; 2020 c. 1, Sch. 5 para. 1(1)

F11

Word in s. 66B(5)(a) omitted (13.9.2018 for specified purposes, 10.12.2018 for specified purposes, 18.7.2019 for specified purposes, 9.8.2019 for specified purposes, 9.12.2019 for specified purposes, 7.12.2020 in so far as not already in force) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 4 para. 17(4); S.I. 2018/990, reg. 2(1)(2)(3) (with regs. 3-6); S.I. 2019/1136, reg. 2(2)(3)(4)(5) (with regs. 3-5, 7)

F12

Word in s. 66B(5)(b) omitted (10.5.2016) by virtue of Bank of England and Financial Services Act 2016 (c. 14), ss. 25(3)(e), 41(3); S.I. 2016/569, reg. 2

F13

S. 66B(5)(d) and word inserted (10.5.2016) by Bank of England and Financial Services Act 2016 (c. 14), ss. 25(3)(f), 41(3); S.I. 2016/569, reg. 2

F14

S. 66B(6) omitted (10.5.2016) by virtue of Bank of England and Financial Services Act 2016 (c. 14), ss. 25(3)(g), 41(3); S.I. 2016/569, reg. 2

F15

Word in s. 66B(7) omitted (13.9.2018 for specified purposes, 10.12.2018 for specified purposes, 18.7.2019 for specified purposes, 9.8.2019 for specified purposes, 9.12.2019 for specified purposes, 7.12.2020 in so far as not already in force) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 4 para. 17(5)(a); S.I. 2018/990, reg. 2(1)(2)(3) (with regs. 3-6); S.I. 2019/1136, reg. 2(2)(3)(4)(5) (with regs. 3-5, 7)

F16

Words in s. 66B(7) omitted (13.9.2018 for specified purposes, 10.12.2018 for specified purposes, 18.7.2019 for specified purposes, 9.8.2019 for specified purposes, 9.12.2019 for specified purposes, 7.12.2020 in so far as not already in force) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 4 para. 17(5)(b); S.I. 2018/990, reg. 2(1)(2)(3) (with regs. 3-6); S.I. 2019/1136, reg. 2(2)(3)(4)(5) (with regs. 3-5, 7)

F17

Words in s. 66B(8) inserted (6.7.2016) by Bank of England and Financial Services Act 2016 (c. 14), ss. 25(3)(h), 41(3); S.I. 2016/627, reg. 2(1)(s)

F18

Words in s. 66B(8) omitted (13.9.2018 for specified purposes, 10.12.2018 for specified purposes, 18.7.2019 for specified purposes, 9.8.2019 for specified purposes, 9.12.2019 for specified purposes, 7.12.2020 in so far as not already in force) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 4 para. 17(6); S.I. 2018/990, reg. 2(1)(2)(3) (with regs. 3-6); S.I. 2019/1136, reg. 2(2)(3)(4)(5) (with regs. 3-5, 7)

F19

S. 66B(9) omitted (13.9.2018 for specified purposes, 10.12.2018 for specified purposes, 18.7.2019 for specified purposes, 9.8.2019 for specified purposes, 9.12.2019 for specified purposes, 7.12.2020 in so far as not already in force) by virtue of Bank of England and Financial Services Act 2016 (c. 14), s. 41(3), Sch. 4 para. 17(7); S.I. 2018/990, reg. 2(1)(2)(3) (with regs. 3-6); S.I. 2019/1136, reg. 2(2)(3)(4)(5) (with regs. 3-5, 7)

Modifications

C1

Ss. 66-70 applied (with modifications) (1.1.2019) by The Securitisation Regulations 2018 (S.I. 2018/1288), reg. 1, Sch. 1 para. 1 (with Sch. 1 paras. 13, 14)

C2

Ss. 66-70 applied (with modifications) (13.8.2017 for specified purposes, 13.1.2018 in so far as not already in force) by The Payment Services Regulations 2017 (S.I. 2017/752), reg. 1(2)(b)(i)(6), Sch. 6 para. 1 (with reg. 3) (as amended (29.8.2023) by Financial Services and Markets Act 2023 (c. 29), s. 86(3), Sch. 2 para. 72(a) (with s. 2(3)); S.I. 2023/779, reg. 4(zz)(iv))

Notes on Part V

Modifications

C1

Pt. 5 modified (1.12.2001) by S.I. 2001/3592, arts. 1(2), 114(3)(a), 128(3)(a) (with art. 23(2))

C2

Pt. 5 modified (7.11.2018) by The EEA Passport Rights (Amendment, etc., and Transitional Provisions) (EU Exit) Regulations 2018 (S.I. 2018/1149), regs. 1(2), 23 (with regs. 4, 22, 26(1)(2)) (as amended (31.1.2020 immediately before exit day) by The Financial Services (Consequential Amendments) Regulations 2020 (S.I. 2020/56), regs. 1, 6(2))

C3

Pt. 5 modified by S.I. 2018/1149, reg. 69 (as inserted (1.3.2019) by The Financial Services Contracts (Transitional and Saving Provision) (EU Exit) Regulations 2019 (S.I. 2019/405), regs. 1(2), 4)

Notes on Conduct of approved persons and others

Textual amendments

F1

Ss. 64A, 64B and cross-heading inserted (25.7.2014 for specified purposes, 7.3.2016 for specified purposes) by Financial Services (Banking Reform) Act 2013 (c. 33), ss. 30(3), 148(5); S.I. 2014/1819, art. 2(2)(c); S.I. 2015/490, art. 2(1)(d) (as inserted by S.I. 2015/2055, art. 2(4) and with savings and transitional provisions in S.I. 2015/492 (as amended by S.I. 2015/1660))