Article 29 of the Saudi Finance Companies Control Law

This article shows when and how SAMA intervenes toward a finance company. Intervention is in three cases:

• Committing violations relating to professional misconduct.
• Dealings that put shareholders or creditors at risk.
• The company's debts exceeding its assets.

SAMA then takes, by written decision and in proportion to the size of the violation, one or more of the following measures:

1. A warning.
2. Requiring the company to submit a program to remove the violation and correct the position.
3. Requiring it to stop some of its operations or barring it from distributing profits.
4. Imposing the fine provided for in Article 34 as the case may be, which is a fine not exceeding SAR 250,000, and where the violation continues a fine not exceeding SAR 10,000 per day may be imposed.
5. Requiring it to suspend the violating person, other than board members, temporarily, or to dismiss him, depending on the seriousness of the violation.
6. Temporarily suspending the chairman of the board or any member of it.
7. Appointing one or more advisers at the company's expense.
8. Suspending the board's authority and appointing a manager at the company's expense until the causes cease, as SAMA assesses.

As for cancelling the license or liquidating the company, SAMA does not have this by its own decision but must bring a case before the competent court, and in the cases it assesses it may suspend the license until the case is decided.

It is preceded by Article 28 on periodic examination, and followed by Article 30, which allows any interested person to file a grievance against SAMA's decisions before the competent court within 60 days of learning of the decision.

If one of these decisions is issued against a company, it is advisable to consult a lawyer who specializes in banking and finance.