The new Criminal Code came into force on July 24 2001 and has introduced substantial changes to the Colombian financial system.

First, the new code includes a special chapter entitled Offences Against the Financial System, which deals with offences that are isolated or dispersed among several regulations. The legislator found it advisable to gather these offences under one criterion and include them in one regulatory body.

At the same time the new Criminal Code adopted a more comprehensive outlook on the offence of 'economic panic', ruled within the chapter devoted to Offences Against the Economic Order. This defined 'offensive behaviour' as the disclosure of information that could alter the prices of basic goods, salaries, raw materials, trade values or shares. The new code includes as criminal behaviour the public disclosure of false or inexact information that may affect the confidence and credibility of customers, users, investors or shareholders of an institution under surveillance by or control of the Banking or the Values Superintendencies, or any other scheme of collective investment legally constituted. Offensive behaviour is also the disclosure of information with the intention to provoke or stimulate the withdrawal of national or foreign capital from the country.

Further, the new code modified Article 235, which deals with the practice of usury. This was previously defined as the charging of an exorbitant rate of interest for a money loan, usually half as much again as the interest rate charged by the banks for credits of free disposition. This action must have taken place over the course of a year.

According to the amendment the offence is typified not by the time over which the offence took place but rather once the interest rate is at least half as much again as the usual interest rate charged by the banks during the corresponding period, according to the certification issued by the Banking Superintendency every two months.

For further information on this topic please contact Luis Carlos Neira at Holguin Neira y Pombo Abogados by telephone (+57 1 312 2473) or by fax (+57 1 312 2513) or by e-mail ([email protected]).

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