THE LEGAL SYSTEM OF BANKING INSPECTION LEGAL STUDY

Abstract

Central banks exercise supervision over banks of all kinds to ensure their compliance with the provisions of the relevant banking laws, regulations and instructions, the integrity of the banking systems in force, the integrity of the procedures taken by them when practicing banking operations and the strength of their financial positions. The Central Bank exercises this control based on the provisions and powers stipulated in its law, the Banking Law and other relevant laws

They are office control After banks implement their obligation to provide the Central Bank with periodic reports and statements, the bank studies and analyzes these documents to ensure their compliance with banking legislation, including the Anti-Money Laundering and Combating the Financing of Terrorism Law, compliance with the decisions and orders issued by the bank, identifying their financial positions and ensuring their safety, and the degree of efficiency with which they exercise their functions, and the second is field control (inspection) to assess the financial condition of banks and the risks associated with their banking business and verify the integrity of internal control systems.  in which and commitment to the instructions of banking governance.

The aims of study to clarify the concept of banking inspection and its legal system and includes: the scope of inspection (temporal, objective and personal), those in charge of the inspection, the obligations of the inspector, including conducting the required inspection, commitment to confidentiality and preparing the final report, and a statement of the duties of the inspected bank in providing the required records, books and documents and providing information, a statement of the inspector's responsibility and immunity that he enjoys.                 

Conclusions:

1. The field supervisory supervision exercised by central banks is a necessity necessitated by the integrity of banking systems and operations and to ensure the extent to which banks comply with laws, regulations and instructions, including the provisions on combating money laundering and terrorist financing.


2. The Basel Committee and legislators in the countries of the world, including the Iraqi legislator, were interested in developing rules governing inspections carried out by the Central Bank in implementation of its duties and to achieve the objectives of the inspection and what is the nature of the inspector's responsibility and immunity.


3. The legal framework for bank inspection defines the temporal and substantive scope of the inspection, the obligations of the inspectors and the duties of the inspected bank.


4. The legislative treatment of banking inspection was general, comprehensive and unified for all types of banks.

The most prominent recommendations:

1. The need to develop detailed legal rules related to the qualifications and powers of the inspector and inspection bodies and the independence of their work


2. Since the banks are diverse (governmental, private, Islamic and specialized), it is necessary to reflect this on the framework regulating inspection in all its aspects.