RBNZ completes new enforcement framework

The Reserve Bank of New Zealand (RBNZ) has completed its enhanced enforcement framework with the publishing of its enforcement guidelines and investigation guidelines.

RBNZ deputy governor and general manager of financial stability Christian Hawkesby said the enforcement framework had been reviewed and developed to contribute to financial stability by modernising and strengthening the central bank’s enforcement function.

“The enhanced framework supports our goals of encouraging and enforcing compliance among our regulated entities to maintain public confidence in them,” Hawkesby said. “The framework consists of three public documents which set out our policy for how we select matters for investigation, conduct investigations, and ultimately take decisions relating to enforcement matters.”

The framework’s foundational document, the Enforcement Principles and Criteria, was published in May 2022, following public consultation. According to RBNZ, these principles and criteria identify and describe the fundamental considerations that it will work through and weigh when deciding on the appropriate response to serious non-compliance.

The Enforcement Guidelines set out RBNZ’s regulatory response model, focusing on the enforcement-led elements of its regulatory response toolkit, which includes court responses and statutory warnings. The guidelines also provide additional examples on how the regulator may apply the principles and criteria when considering the appropriate response to a matter of serious non-compliance.

The Investigation Guidelines contain the regulator’s approach to investigations and describe how it will apply the principles and criteria throughout the lifecycle of an investigation. The investigation guidelines provide an overview of how matters are referred to enforcement, the investigation process, and the information gathering methods available to the enforcement function.