102Certain financial accommodation to officers prohibited

102 Certain financial accommodation to officers prohibited

102 Certain financial accommodation to officers prohibited

(1) An officer of a society who is not a director of the society must not obtain financial accommodation from the society other than—

(a) with the approval of a majority of the directors, or

(b) under a scheme about providing financial accommodation to officers that has been approved by a majority of the directors.

Maximum penalty—200 penalty units or imprisonment for 5 years, or both.

(2) For the purposes of this section, financial accommodation is taken to be obtained by an officer of a society if it is obtained by—

(a) a proprietary company in which the officer is a shareholder or director, or

(b) a trust of which the officer is a trustee or beneficiary, or

(c) a trust of which a body corporate is trustee if the officer is a director or other officer of the body corporate.

(3) A society must not give financial accommodation to an officer of the society if—

(a) by giving the financial accommodation, the officer would contravene this section, and

(b) the society knows or should reasonably know of the contravention.

Maximum penalty—50 penalty units.