Banking (Customer Service) Law, 5741-1981

חוק הבנקאות (שירות ללקוח), תשמ"א-1981

Published: 1981-04-26Consolidated Hebrew text as of 2026-03-31 · Last amended 2026-07-22✓ Amendment status checked against the Knesset legislation record on 2026-09-28

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Chapter III: Penalties and Other Sanctions

Penalties§

10.

A banking corporation that has done any of the following is liable to double the fine prescribed in section 61(a)(3) of the Penal Law, 5737-1977:

(1)Contravened a provision of Chapter II, except sections 2(e), 5, 5a, 5a1a, 5a2, 5a3, 5a4, 5b2, 5c, 7a to 7d, 7f and 7h and 8, or a regulation, directive or rule made thereunder;

(2)Contravened an undertaking given pursuant to section 12(a).

Manager's Liability§

11.

Where an offence under section 10 has been committed by a banking corporation, the person who was the director general or active director of the corporation, or the senior employee responsible for that area in the principal management of the corporation or in the relevant branch at the time the corporation committed an offence under this Law, shall also be guilty of the offence and is liable to one year's imprisonment, unless that person has proved one of the following:

(1)The offence was committed without that person's knowledge and that person's position did not require that person to be aware of the offence;

(2)After becoming aware that the corporation was about to commit the offence, that person took all reasonable steps to prevent the corporation from committing the offence.

Financial Sanction§

11a.

(a)

(1)Where the Supervisor has reasonable grounds to believe that an issuer has done any of the following, the Supervisor may impose on the issuer a financial sanction of fifty thousand new shekels:

(a)Made a change to an unlimited-period benefits programme or terminated such a programme without sending the customer a notice in accordance with the provisions of section 5a2(b)(1);

(b)Did not enable the customer to redeem the benefits in accordance with the conditions of an unlimited-period benefits programme, contrary to the provisions of section 5a2(b)(2);

(c)Made a change to an unlimited-period benefits programme that includes the accrual of rights, or terminated such a programme, without sending the customer a notice in accordance with the provisions of section 5a2(c)(1);

(d)Did not enable the customer to redeem the rights accrued by the customer in accordance with the conditions of an unlimited-period benefits programme, contrary to the provisions of section 5a2(c)(2);

(e)Made a change to a fixed-period benefits programme or terminated such a programme before the end of the fixed period, contrary to the provisions of section 5a2(d);

(f)Sent the customer notices otherwise than in accordance with the provisions pursuant to section 5a2(e) or (f)(1);

(1a)Where the Supervisor has reasonable grounds to believe that a banking corporation did not provide a customer with a professional human response in accordance with the provisions pursuant to section 5a3, the Supervisor may impose on it a financial sanction of fifty thousand new shekels;

(2)Where the Supervisor has reasonable grounds to believe that a banking corporation did not rectify a deficiency in accordance with the Supervisor's directives given to it pursuant to section 16(b), or did not grant a housing loan to a person with a life-shortening disability contrary to the provisions of section 19bq of the Equal Rights for Persons with Disabilities Law, 5758-1998, the Supervisor may impose on it a financial sanction of two hundred and fifty thousand new shekels.

(a1)Where the Supervisor has reasonable grounds to believe that a banking corporation has done any of the following, the Supervisor may impose on it a financial sanction of fifty thousand new shekels:

(1)Did not enable the customer to submit, online, a request to transfer the financial activity from an originating bank to a receiving bank, contrary to the provisions of section 5b1;

(2)Collected from the customer payment for the financial activity transfer process, contrary to the provisions of section 5b1;

(3)Did not enable the customer to transfer the customer's financial activity from an originating bank to a receiving bank within the period referred to in section 5b1(b), contrary to the provisions of that section, except for categories of financial activity for which the Governor has set a period as referred to in section 5b1(c);

(4)Contravened a provision of the provisions set in rules pursuant to section 5b1;

(5)Did not deliver a notice to the customer in accordance with the provisions of section 5a1a or 5a4, or delivered such a notice otherwise than in accordance with the provisions of that section;

(6)Did not enable the customer to deposit funds through an account in a closed system, contrary to the provisions of section 5b2(b);

(7)Exerted undue influence on a customer, contrary to the provisions of section 5b2(d).

(8)Did not record a voice call, contrary to the provisions of section 5a5(b)(1);

(9)Did not notify the customer at the commencement of a recorded call that it is being recorded and that the customer is entitled to receive it, contrary to the provisions of section 5a5(b)(2);

(10)Did not retain a recorded call, contrary to the provisions of section 5a5(b)(3);

(11)Did not provide a recorded call or details of the time of a call to a customer who so requested, contrary to the provisions of section 5a5(b)(4);

(12)Collected consideration for providing a recorded call or details of the time of a call, contrary to the provisions pursuant to section 5a5(c).

(b)Where the Supervisor has reasonable grounds to believe that a banking corporation has done any of the following, the Supervisor may impose on it a financial sanction of seven hundred and fifty thousand new shekels:

(1)Contravened a provision of section 5a;

(1a)Published an advertisement or employed another marketing method that does not include the lender's name or to which no warning was appended, contrary to the provisions of section 5(c);

(2)Contravened a provision of the provisions of section 9e, or demanded a fee in an amount exceeding the maximum amount prescribed in section 9g(a), (a1) and (b), contrary to the provisions of that section;

(3)Collected a fee for a service not included in the full tariff or in the reduced tariff, or otherwise than in accordance with the calculation set in rules pursuant to section 9i, contrary to the provisions of section 9j;

(3a)Collected a fee in an amount or at a rate exceeding the amount or rate set out in the tariff published by the banking corporation, or otherwise than in accordance with the provisions of such a tariff, contrary to the provisions of section 9j1;

(3b)Collected a fee in an amount or at a rate exceeding the amount or rate agreed with the customer, contrary to the provision of section 9j2;

(3c)Collected a fee for a service even though the service was not actually provided to the customer, contrary to the provisions of section 9j3;

(4)Increased the amount or rate of a fee for a service that is not a supervised service without having given notice thereof to the Supervisor, contrary to the provisions of section 9o;

(5)(Repealed);

(6)Did not distribute debit cards of issuers with whom it has a distribution agreement, contrary to the provisions of section 7f;

(7)Did not present the customer with information on transactions, contrary to the provision of section 7g(a);

(8)Made use of information that came into its possession otherwise than for the purpose of presenting it, contrary to the provisions of section 7g(d);

(9)Did anything that may mislead a customer on any material matter in relation to the provision of a service to a customer, from among the matters listed in section 3, contrary to the provisions of that section.

(c)Where the Supervisor has reasonable grounds to believe that a banking corporation has done any of the following, the Supervisor may impose on it a financial sanction of one million five hundred thousand new shekels:

(1)Contravened a provision of the provisions set in rules pursuant to section 5;

(2)Contravened a provision of the provisions set pursuant to section 8;

(3)Did not notify its customers of the amounts of fees it collects for services included in the full tariff, in the manner determined by the Governor pursuant to section 9i(c);

(4)Did not notify a customer of a category determined pursuant to section 9i(b), of a fee it collects for services included in the reduced tariff applicable to customers of that category, in the manner determined by the Governor pursuant to the provisions of section 9i(c);

(4a)Did not notify its customers of the services in respect of which it collects fees, and of the amounts of fees it collects for such services or their rates, in the manner prescribed in section 9j4(c);

(5)Collected a fee for a supervised service otherwise than in accordance with a provision pursuant to section 9l or a permit pursuant to section 9m, contrary to the provisions of section 9n.

(d)The Supervisor is not entitled to impose a financial sanction lower than the financial sanction prescribed in this Chapter except pursuant to the provisions of subsection (e).

(e)The Governor, in consultation with the Minister of Justice, may determine categories of cases, circumstances and considerations by reason of which the Supervisor may impose a financial sanction lower than the sanction prescribed in subsections (a) to (c), and at maximum reduction rates to be determined by the Governor.

(f)The provisions of sections 14j to 14o of the Banking Ordinance shall apply to a financial sanction pursuant to this section, with the necessary modifications.

Undertaking by a banking corporation§

12.

(a)If the Supervisor is of the opinion that a banking corporation has committed an offence under this Law, he may, with the approval of the Attorney General or his representative, agree to accept from it a written undertaking towards him in respect of the matters set out below or any one of them:

(1)to refrain from an act or omission specified in the written undertaking, which in the Supervisor's opinion constitutes an offence under this Law;

(2)to compensate the customer;

(3)to rescind the transaction in which the offence was committed;

(4)to publish a public notice as the Supervisor shall direct.

(b)A banking corporation that has given an undertaking as referred to in this Section shall not be subject to criminal proceedings under this Law in respect of an act or omission that served as the grounds for giving the undertaking, and subject to the decision of the Attorney General – proceedings as aforesaid shall not be taken against a director or employee as referred to in section 11.

(c)The acceptance of an undertaking as referred to in this Section shall not derogate from the right of a customer to claim compensation under section 15.

Court order for the prevention of an offence§

13.

Upon application by the Attorney General or his representative or by the Supervisor, the court may order any action required for the prevention of an offence under this Law and the giving of security therefor, including a correction to a misleading publication.

Publication of a judgment or correction of a publication§

14.

The court may order that a final judgment in proceedings under this Law, or a summary thereof or a correction to a misleading publication, be published publicly in such form and manner as it shall determine, and may direct who shall bear the costs of publication; if the court orders that the accused shall bear the costs of publication, those costs shall have the same status as a fine imposed by the court.

Compensation§

15.

Damage caused to a person by an offence against the provisions of this Law, or against any Regulations made thereunder, shall have the same status as damage in respect of which compensation may be claimed under the Civil Wrongs Ordinance [New Version], and for the purposes of this Section it is immaterial –

(1)whether the damage was caused directly or indirectly;

(2)whether the damage consists of a monetary loss or loss of profit;

(3)whether the offender was tried criminally or not;

(4)whether the offender did not intend to cause the damage or could not have foreseen it.

Public inquiries§

16.

(a)The Supervisor shall examine public inquiries regarding dealings with banking corporations that he considered to have substance, and shall exercise his powers under the Banking Ordinance 1941 for this purpose.

(b)If the Supervisor finds that an inquiry was justified, he shall notify the inquirer and the banking corporation concerned accordingly; the Supervisor shall set out in his notice the findings of the examination and the means of remedying the deficiency he found.

(c)If the Supervisor finds that an inquiry was not justified, or that it is not worthy of examination by him, he shall notify the inquirer accordingly; the Supervisor may set out in his response the findings of the examination.

(d)The decisions and findings of the Supervisor in the examination of an inquiry –

(1)shall not confer upon the inquirer or upon any other person a right or remedy in a court or tribunal that did not exist before;

(2)shall not prevent the inquirer or any other person from exercising another right or seeking another remedy to which that person is entitled, provided that if a time limit for doing so has been prescribed by legislation, such time limit shall not be extended by the submission of the inquiry to the Supervisor or its examination.

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