DEPOSIT INSURANCE ACT

ARRANGEMENT OF SECTIONS

   1   Short title

   2   Interpretation

   3   Establishment of this Corporation

   4   Principal objects of Corporation

   5   Functions of Corporation

   6   Report by Corporation

   7   Relationship with the Bank of Jamaica

   8   Insurance Act not applicable to Corporation

   9   Capital of Corporation

   10   Accounts and Audit

   11   Annual report

   12   Application by financial institutions for deposit insurance

   13   Insurance of deposits

   14   Insurance of policy and certificate

   15   Cancellation of policy

   16   Appeal against cancellation

   17   Deposit Insurance Fund

   18   Payments out of Fund

   18A    Payment out of Fund in relation to foreign currency account deposits

   18B    Cessation of accrual of interest on deposit accounts

   18C    Beneficial interest in trust and nominee accounts

   18D    Deposits of depositor with policyholders that subsequently amalgamate

   19   Persons entitled to payment

       Payments by transferred deposit

   20   No payment to depositor who profited from insolvency of institution

   21   Exemptions from tax, stamp duty, etc

   22   Carrying on business, without insurance

   23   Offences by corporate officers

   24   Obligation for secrecy

       Minister may amend monetary penalties

   25   Regulations

   26   Applications by existing institutions

      SCHEDULE

 

THE DEPOSIT INSURANCE ACT

[Date of Commencement: 31st August, 1998]

Acts
3 of 1998,
36 of 1999,
1 of 2011.

PART I
Preliminary (sections 1-2)

1   Short title

   This Act may be cited as the Deposit Insurance Act.

2   Interpretation

   (1) In this Act, unless the context otherwise requires-

   "Bank" means the Bank of Jamaica established under the Bank of Jamaica Act;

   "Board" means the Board of Directors of the Corporation appointed under the Schedule;

   "Corporation" means the Jamaica Deposit Insurance Corporation established under section 3;

   "deposit" means-

   (a)   a sum of money paid on terms-

         (i)   under which the sum will be repaid, with or without interest or a premium, and either on demand or at a time or in circumstances agreed by or on behalf of the person making the payment and the person receiving it; and

         (ii)   which are not-referable to the provision of property or services or to the giving of security, and for the purposes of this paragraph, money is paid on terms which are referable to the provision of property or services or to the giving of security if, and only if-

         (A)   it is paid by way of advance or part payment for the sale, hire or other provision of property or services of any kind and is repayable only in the event that the property or services is or are not in f act sold, hired or otherwise provided; or

         (B)   it is paid by way of security for payment for the provision of property or services of any kind provided or to be provided by the person by whom or on whose behalf the money is accepted; or

         (C)   it is paid by way of security for the delivery up or return of any property, whether in a particular state of repair or otherwise,

and includes any interest payable in respect of the sum of money;

   (b)   a share in a building society, other than a capital share, a deferred share or a preference share;

   (c)   such other liabilities as may be determined by the Minister, on the advice of the Board,

and for the purposes of this definition the terms "capital share" and "deferred share" shall have the meanings assigned to them respectively under the Bank of Jamaica (Building Societies) Regulations, 1995.

   "financial institution" means-

   (a)   a bank licensed under the Banking Act or a financial institution licensed under the Financial Institutions Act;

   (b)   a building society licensed under the Building Societies Act; or

   (c)   subject to subsection (3), any other person or undertaking whose business includes the accepting of deposits and who has been declared by the Minister under section 2 of the Bank of Jamaica Act to be a specified financial institution;

   "functions" includes powers and duties;

   "Fund" means the Deposit Insurance Fund established under this Act;

   "government company" means a company registered under the Companies Act, being a company in which the Government or an agency of the Government, by the holding of shares, is in a position to direct the policy of that Company;

   "insurable deposit" means a deposit received or held by a policyholder from or on behalf of a depositor other than a deposit from-

[1/2011 s 2(a)(i).]

   (a)   another policyholder;

[1/2011 s 2(a)(ii).]

   (b)   a statutory body or authority or government company;

[1/2011 s 2(a)(ii).]

   (c)   a Ministry, department or agency of the Government;

[1/2011 s 2(a)(iii).]

   (d)    a Parish Council, the Kingston and St. Andrew Corporation or a Municipal Council;

[1/2011 s 2(a)(iii).]

   "insured deposit" means that portion of an insurable deposit which is covered by insurance under this Act;

   "nominee" includes-

   (a)   an agent;

   (b)   a guardian;

   (c)   a custodian; and

   (d)   the Supreme Court, or a Resident Magistrate's Court in the case of property the value of which is within the monetary jurisdiction of that Court, pursuant to section 29(1) of the Mental Health Act;

[1/2011 s 2(b).]

   "nominee account" means monies held on account by a nominee for the benefit of a principal or ward of the nominee, or of a minor or patient, as the case maybe;

[1/2011 s 2(b).]

   "policyholder" means a financial institution to which a policy of deposit insurance has been issued pursuant to section 14.

   (2) For the purposes of this Act a financial institution is in a state of financial distress if-

   (a)   it becomes insolvent that is to say, a winding up order has been made by a court against that institution or a resolution for a creditor's voluntary winding up has been passed;

   (b)   there exists in relation to the institution any condition precedent to the exercise of the powers of the Minister in the interest of and for the protection of depositors, to take such steps or apply such sanctions as authorised under the Banking Act, Bank of Jamaica Act, Building Societies Act, or Financial Institutions Act, as the case may require;

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