Jordan Times
Sunday, May 23, 2004
By Rami Abdelrahman
AMMAN — The 29th annual conference of the International Organisation of Securities Commissions (IOSCO), which concluded here late Thursday, announced several initiatives addressing challenges to the world's capital markets in 2005.During the three-day conference, the host Jordan Securities Commission was reelected for the second time as the vice president of the Emerging Markets Committee and as a member of the board.
More than 500 participants from the world's securities commissions, which regulate 90 per cent of capital markets, approved a document presented by the board to prevent fraud and financial crimes.
The document was submitted by a specialised high-level task force, appointed by Portuguese Chairman Fernando Dos Santos, to strengthen securities markets against financial fraud.
The document urges members to combat fraud, which has become a major concern for the IOSCO, and to operate according to international high standards, Dos Santos told reporters at the closing press conference.
Andrew Cheng, chairman of IOSCO's Executive Committee told The Jordan Times that IOSCO is more concerned with cross-border fraud cases, as internal cases can be tackled by local regulators.
He could not quantify how deep fraud cases are today, but remarked that public expectations related to fraud combating have increased.
The IOSCO Presidents Committee endorsed the “Principals on Client Identification and Beneficial Ownership for the Securities Industry,” that were adopted earlier in the conference by the technical and executive committees.
Dos Santos said the adoption of these principals represents the commitment of the global community of securities regulators to robust standards of client identification for securities sector. He indicated that improved identification will help the IOSCO play a bigger role in combating terrorism financing, and would enable the IOSCO to “closely” monitor operations.
He added that a memorandum of understanding (MoU) adopted in May 2002 commits member regulators to share information with the IOSCO and its other members in order to help track terrorism financing and cross-border fraud, according to Dos Santos.
The Multilateral Memorandum Concerning Consultation and Cooperation and the Exchange of Information was signed by 26 IOSCO members in Amman, while two jurisdictions joined Appendix B of the MoU, which commits them to undertake necessary reforms to become a full signatory.
The IOSCO also updated its Code of Conduct for Credit Rating Agencies, and announced it will adopt its “e-Methodology” — an electronic, interactive Internet feature intended to facilitate IOSCO member self-assessment and third party assessments of regulatory systems.
IOSCO is focusing its efforts on promoting the implementation of its “Assisted Self-Assessment Programme,” which is a pilot programme approved in 2003 to assist its members in the completion of a self-assessment of their level of the implementation of IOSCO's objectives and Principals of Securities Regulations. The next step is collectively developing an action plan to correct identified deficiencies.
The Executive Committee also announced setting up an Islamic Capital Market Task Force to undertake a fact-gathering exercise to assess the extent of the development and potential regulatory issues relating to the market, as well as collecting information on its activities.
IOSCO also announced it will conduct a variety of seminars and training programmes throughout the year, to help raise the expertise of regulatory commissions' staffs.
The board and members also discussed technical issues related to investment schemes and asset management, accounting, auditing and disclosure and the regulation of secondary markets and market intermediaries. IOSCO's will hold a high-level conference in New York to follow up on the initiatives and issues discussed in Jordan, and to engage in extensive dialogues on updated issues. The next annual meeting will be held in Sri Lanka in May 2005.