Since 2011, the Department’s investigators are also authorized to conduct administrative inquiry proceedings.
The purpose of the administrative process is to streamline enforcement procedures, reduce the time between the commission of a violation and the imposition of a penalty that is commensurate with the severity of the offense.
Contrary to criminal offenses, administrative offenses require no proof of men rea, but only proof of negligence or are defined as strict liability offenses.
Criminal Investigation or Administrative Enforcement?
Criteria for initiating a criminal investigation or, according to the relevant provisions of Chapter 10 of the Securities Law or an administrative enforcement procedure under Chapter 8 of the Securities Law:
1. The severity of the act or omission and its circumstances.
2. An assessment of the nature and preponderance of the evidence.
3. The ISA’s enforcement policy.
Administrative enforcement can include various administrative enforcement measures, including a financial sanction, payment to the victim of the violation, action to correct the violation and prevent a recurrence, prohibition to serve as a senior position holder in a supervised body, cancelation or suspension of a license / approval or permit, etc.
Enforcement measures according to paragraph 54B
The Securities Law provides the Chairperson of the ISA with the authority, if he has a reasonable suspicion that a violation has occurred or a reasonable suspicion that a securities offense has been committed, to enter into an enforcement arrangement with the violator or suspect even before the completion of the administrative inquiry process or the criminal investigation, subject to the consent of the violator / suspect to the terms that will be stipulated in the enforcement arrangement, with the approval of the Administrative Enforcement Committee and according to the considerations listed in the law