Singapore legislation
Clause 24
Clause 24
Restriction on granting unsecured loans, advances or credit facilities to director, etc., of licensed financial adviser
(1)
No licensed financial adviser shall grant any unsecured advance, unsecured loan or unsecured credit facility to any of its directors, officers, employees or representatives, where —
the unsecured advance, unsecured loan or unsecured credit facility is given for the purpose of enabling or assisting the person to whom the credit is given to purchase, subscribe for or trade in any investment product; or
the licensed financial adviser knows or has reason to believe that the unsecured advance, unsecured loan or unsecured credit facility will be used for the purpose of purchasing, subscribing for or trading in any investment product.
(2)
No licensed financial adviser shall, in relation to any unsecured advance, unsecured loan or unsecured credit facility granted to any of its directors, officers, employees or representatives before the appointed day, extend the period of, or increase the amount of, such unsecured advance, unsecured loan or unsecured credit facility on or after the appointed day.
(3)
No licensed financial adviser shall grant any unsecured advance, unsecured loan or unsecured credit facility —
to a director of the licensed financial adviser, other than a director who is its employee; or
to any other officer or an employee of the licensed financial adviser (including a director who is its employee) or any of its representatives which, in the aggregate and outstanding at any one time, exceeds $3,000 or such other amount as may be prescribed.
(4)
For the purposes of this section —
a reference to “director” includes a reference to the spouse, father, step-father, mother, step-mother, son, step-son, daughter, step-daughter, brother or sister, of a director; and
the Authority may prescribe the items which constitute “unsecured advance”, “unsecured loan” or “unsecured credit facility”.
(5)
Any licensed financial adviser which contravenes this section shall be guilty of an offence.
(6)
This section shall have effect without prejudice to section 162 of the Companies Act (Cap. 50).