Date Published 24/03/2022
Central Bank fines BNY Mellon €10 Million
On March 24th 2022 BNY Mellon Fund Services (Ireland) (“BNY Mellon”) was fined €10.78m by the Central Bank of Ireland for regulatory breaches related to the outsourcing of regulated activities. The fine represents the largest financial penalty imposed on a fund service provider in Ireland and is among the largest ever levied by the Central Bank on any regulated entity.
The Central Bank investigation found that BNY Mellon did not have in place an adequate outsourcing governance framework and had also failed to comply with its regulatory obligations in respect of outsourcing. The Central Bank determined that the failings it identified in BNY Mellon’s outsourcing framework undermined the company’s ability to effectively identify and manage the risks associated with its outsourcing arrangements. In total it found that the firm had breached 16 regulations between July 2013 and December 2019, with the duration of the breaches ranging from 26 days to up to six years.
The investigation also concluded that the firm did not engage openly and transparently with the regulatory authorities once breaches of its regulatory obligations were identified by the Central Bank. Its conduct was accordingly deemed to have been exacerbated through the provision of inaccurate and misleading information.
Please contact us for more information on this case and its implications for regulated entities operating in Ireland including but not limited to fund administrators.