Cyprus Mail
Cyprus

CySEC has difficulty  collecting fines, audit office finds

Difficulties in the collection of administrative fines and receivables for 2019 were found in the audit service’ special report on the Cyprus Securities and Exchange commission (CySEC), it emerged on Friday.

According to the audit service, receivables at the end of 2019 totaled €0.56 million while administrative fines totaling €19.8 million failed to be collected.

More specifically, at the end of 2019 the receivables amounted to €566,387 while at the end of 2018 amounted to €901,021.

At the same time, it was also observed that administrative fines amounting to €19,865,783 remained uncollected. At the end of 2018 the total amounted to €20,608,302.

As stated in the report, part of the reduction concerns write-offs of €170,800 and bad debt provisions amounting €560,000.

It also pointed out that except for the above-mentioned write-offs of balances and bad debts provision, the balances were carried over from year to year and are presented in the balance sheet in their original value -that is the amount of the fine as originally imposed.

“As the above indicate, CySEC faces difficulties in collecting both the administrative fines and receivables from contracts with supervised entities,” the report said, adding that no expected credit losses were found in the uncollected administrative fines based on the IFRS 9 standard.

In addition, the special report noted that there was a complaint that on New Year’s Eve 2021, CySEC personnel did not work, even though the day is not included in its official holidays “a fact we confirmed in our telephone conversation with an official from CySEC,” the audit service noted.

According to the report, CySEC’s president Giorgos Theocharides had granted staff the holiday for the dedication they showed during the adverse conditions of the coronavirus pandemic.

“Our service is of the opinion that the above decision was not lawful since the difficult conditions described apply to the entire wider public sector where there was no similar concession,” noted the audit service.

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