📜 Code of Conduct
The PLA Code of Conduct establishes the standards of professionalism, fairness, and accountability required of all members. It ensures that all lending practices are conducted lawfully, transparently, and with respect for clients’ rights.
1. Legal & Licensing Requirements
- Only incorporated entities under the Companies Act, International Business Companies Act, or Partnership Act may operate as money lenders and be members of the PLA.
- All members must obtain and maintain a valid Money Lending License issued by the Securities Commission of The Bahamas (the Commission).
- Members must pay their annual membership dues and comply with all rules, guidelines, and resolutions of the PLA to maintain good standing.
- Members shall immediately notify the Association of any suspension, revocation, or restriction of their lending license.
2. Fair Dealing & Responsible Lending
- Members shall act fairly, honestly, and transparently in all dealings with clients, regulators, and the public.
- Implement responsible lending policies to ensure loans are suitable, repayment capacity is properly assessed, and borrowers are not over-indebted.
- Interest rates, fees, and any other charges must be clearly disclosed in all contracts with no hidden costs.
- Members shall not engage in predatory lending or misleading advertising.
3. Contract Clarity & Mandatory Terms
All loan agreements must be:
- Written in English and signed by both parties;
- Clearly dated and include:
- Principal amount;
- Term and repayment schedule;
- Interest rate and all applicable fees;
- Stamp duty (if applicable);
- Security or collateral details;
- Full names and contact information of the borrower and lender.
- Borrowers must receive a copy of the signed agreement promptly upon request.
4. Interest & Fees
- Members must comply with the Rate of Interest Act, which caps simple interest on Bahamian-dollar loans exceeding $100 at 20% per annum.
- Prohibited practices include:
- Default-triggered interest rate increases;
- Capitalizing default interest beyond statutory limits.
- All fees must be disclosed and consistent with the loan agreement.
5. Repayment & Late Fees
- Repayment schedules must be clearly defined in the loan agreement.
- Late payment fees may be charged only if:
- They are disclosed in advance;
- The calculation method is clearly stated; and
- The amount is reasonable and proportionate.
6. Collateral Management
- Members must clearly disclose the procedures for handling collateral in the event of borrower default.
- Collateral shall be realized only in accordance with the law and any contractual rights agreed upon with the borrower.
- Borrowers must be informed of their rights and obligations regarding pledged assets.
7. Transparency & Record-Keeping
- Members shall maintain accurate and complete records for all lending activities, including borrower information, contracts, payment histories, and collateral documentation.
- Borrowers who request a payment statement must receive one within 72 hours.
- Proper accounting records and financial statements must be maintained and made available to the Commission upon lawful request.
8. Fitness & Proper Conduct
- All owners, directors, officers, and employees must be fit and proper persons, demonstrating honesty, integrity, and financial soundness.
- Individuals with prior criminal convictions involving fraud, dishonesty, or regulatory sanctions are not eligible to hold significant roles.
- All staff must receive training on AML/CFT obligations under the Financial Transactions Reporting Act (FTRA) and its Regulations.
9. Anti-Money Laundering (AML) & Counter-Terrorist Financing (CFT) Compliance
- Members must establish and enforce effective AML/CFT frameworks, including due diligence, ongoing monitoring, and reporting in accordance with the Proceeds of Crime Act, FTRA, and relevant guidelines.
- Internal controls must be documented and subject to regular review and audit where required.
10. Transparency with the Commission
Members shall notify and obtain approval from the Commission prior to:
- Any change in ownership, directors, or control;
- Any merger, acquisition, or sale of loan portfolios;
- Any material change in business operations that may affect licensing or regulatory status.
11. Reporting & Cooperation
- Members must fully cooperate with inspections, reviews, or information requests from the Commission or the PLA.
- Required reports must be accurate, timely, and compliant with statutory and association obligations.
12. Debt Collection Etiquette
- The use of violence, intimidation, threats, or harassment in the collection of debts is strictly prohibited.
- All persons or agents involved in collections must be properly trained and supervised.
- Borrowers must be treated with dignity and respect throughout the collection process.
13. Complaint Handling
- Members shall maintain documented procedures for receiving, investigating, and resolving borrower complaints.
- Unresolved complaints shall be referred to the PLA for independent review.
- All complaints must be resolved within 30 days, with written notification provided to the borrower.
14. Enforcement & Sanctions
- The PLA reserves the right to issue warnings, suspend, or expel members who breach this Code after a fair and impartial review process.
- Members subject to sanctions may appeal decisions to an independent review committee appointed by the Association.
15. Code Review
- This Code shall be reviewed annually or whenever material changes occur in Bahamian legislation, regulatory guidance, or industry best practices.
- Proposed amendments will be circulated to members for consultation prior to adoption.
16. Ethical Commitment
All members of the PLA affirm their commitment to:
- Uphold the highest standards of professional integrity and ethical conduct;
- Protect the reputation of the Association and the broader Bahamian financial sector;
- Act in accordance with both the spirit and the letter of Bahamian laws and regulations, even where the law is silent.