Appropriate Legal Protection of Banking Authorities and Their Staff Members
Laws should grant legal protection for bank authorities and their staff members to fulfill their responsibilities. Legal protection should be coupled in a balanced manner with the legal accountability necessary to prevent any abuse of power so as not to discourage authorities and officials from taking prompt and decisive action.
Of particular importance is personal protection from civil and criminal liability of senior staff members and other officers or agents of the banking authorities who are involved in the declaration of a bank’s insolvency and in the administration of its restructuring, liquidation (including individuals who are appointed as official administrators or liquidators), or both—other than for intentional wrongdoing (e. g., abuse of power, theft, conversion of assets, conspiracy, etc.). This type of protection can be extended (a) by granting express statutory immunity from liability for actions and omissions that the persons concerned have taken in discharge of their legal responsibilities, (b) by making their agency vicariously liable for their faults, (c) by including appropriate indemnification provisions in their contracts of employment, or, perhaps, (d) by a combination of the three mechanisms, depending on the specific legal position of the officials concerned.