REPUBLIC OF SINGAPORE
GOVERNMENT GAZETTE
ACTS SUPPLEMENT
Published by Authority

NO. 26]Friday, December 30 [1994

The following Act was passed by Parliament on 5th December 1994 and assented to by the President on 24th December 1994:—
Finance Companies (Amendment) Act 1994

(No. 27 of 1994)


I assent.

ONG TENG CHEONG
President.
24th December 1994.
Date of Commencement: 18th January 1995
An Act to amend the Finance Companies Act (Chapter 108 of the 1985 Revised Edition).
Be it enacted by the President with the advice and consent of the Parliament of Singapore, as follows:
Short title and commencement
1.  This Act may be cited as the Finance Companies (Amendment) Act 1994 and shall come into operation on such date as the Minister may, by notification in the Gazette, appoint.
Amendment of section 2
2.  Section 2 of the Finance Companies Act (referred to in this Act as the principal Act) is amended —
(a)by inserting, immediately after the definition of “Authority”, the following definition:
“ “capital funds”, in relation to a finance company, means the paid-up capital and published reserves of that company deduction having been made in respect of any debit balance appearing in the profit and loss account of the company;”;
(b)by inserting, immediately after the definition of “financing business”, the following definition:
“ “Government securities” has the same meaning as in the Government Securities Act (Cap. 121A);”; and
(c)by inserting, immediately after the definition of “public company”, the following definition:
“ “published reserves”, in relation to a finance company, means reserves which appear in the accounts of the finance company but does not include any reserves which are represented by the writing down of the value of assets or by provision for the depreciation of fixed assets or which are maintained for any specific purposes;”.
Amendment of section 6
3.  Section 6 of the principal Act is amended by inserting, immediately after subsection (6), the following subsection:
(7)  Every finance company shall pay such annual licence fee (including fees in respect of each of its branches) as the Authority may determine by notice in writing and in such manner as the Authority may determine.”.
New section 6A
4.  The principal Act is amended by inserting, immediately after section 6, the following section:
Appeal to Minister
6A.  Any applicant who is aggrieved by the refusal of the Authority to grant a licence under section 6(3) may, within 30 days of the decision of the Authority, appeal in writing to the Minister whose decision shall be final and shall be given effect to by the Authority.”.
Repeal and re-enactment of section 7, and new section 7A
5.  Section 7 of the principal Act is repealed and the following sections substituted therefor:
Minimum capital requirements
7.—(1)  Subject to this Act, a company shall not be granted or hold a licence unless —
(a)in the case of a finance company which holds a licence to carry on financing business on the appointed day, its capital funds are, subject to this section, not less than $50 million; and
(b)in the case of a finance company which is granted a licence to carry on financing business after the appointed day, its issued and paid-up capital is not less than $50 million and its capital funds are not less than that amount.
(2)  Notwithstanding subsection (1)(a), the Authority may, at any time, after 8 years from the appointed day, by order require the issued and paid-up capital of a finance company to which that subsection applies to be not less than $50 million within such time as may be specified in that order.
(3)  Subject to subsection (4), a finance company to which subsection (1)(a) applies which has capital funds of less than $50 million on the appointed day shall be exempt from the requirement of that provision for 8 years from the appointed day and shall not during that period allow its capital funds to be less than its capital funds on that day.
(4)  If 20% or more of the issued and paid-up capital of a finance company is acquired by one or more persons who, alone or acting together with any associate or associates, by virtue of such acquisition becomes a substantial shareholder of the finance company on or after the appointed day, the finance company —
(a)shall have not less than $50 million in issued and paid-up capital; and
(b)shall cease to be eligible for the exemption under subsection (3),
unless all the new substantial shareholders are finance companies each with capital funds of not less than $50 million at the time of the acquisition.
(5)  A finance company shall not reduce its paid-up capital during the currency of its licence without the approval of the Authority.
(6)  The Authority may restrict or suspend the operations of a finance company which fails to comply with subsection (2), (3), (4) or (5).
(7)  In this section and section 7A, “appointed day” means the date of commencement of the Finance Companies (Amendment) Act 1994.
(8)  In this section, “substantial shareholder” has the same meaning as in section 81 of the Companies Act (Cap. 50).
Capital ratio
7A.—(1)  The Authority may require every finance company to maintain capital funds in Singapore in proportion to its total assets or to every category of assets at such ratio or ratios as may from time to time be determined by the Authority by notice in writing.
(2)  A finance company shall maintain a capital adequacy ratio of not less than 12% or such other percentage as may be determined by the Authority from time to time, as calculated in accordance with such form, content and manner as may be determined by the Authority by notice in writing.
(3)  A finance company which on the appointed day is unable to comply with the capital adequacy ratio requirement of 12% in subsection (2) shall, within one year from that day, comply with the ratio but the finance company’s capital adequacy ratio shall not at any time during that period be less than its capital adequacy ratio on the appointed day.
(4)  The Authority may suspend or restrict the operations of a finance company which fails to comply with subsection (2) or (3) or any requirement of the Authority under subsection (1).”.
Repeal and re-enactment of section 18, and new section 18A
6.  Section 18 of the principal Act is repealed and the following sections substituted therefor:
Maintenance of reserve fund by finance companies
18.—(1)  Every finance company shall —
(a)maintain a reserve fund;
(b)transfer to that reserve fund out of the net profits of each year, after due provision has been made for taxation —
(i)so long as the amount of the reserve fund is less than 50% of the paid-up capital, a sum not less than 50% of those net profits;
(ii)so long as the amount of the reserve fund is not less than 50% but less than 100% of the paid-up capital, a sum not less than 25% of those net profits; and
(iii)so long as the amount of the reserve fund is 100% or more of the paid-up capital, a sum not less than 5% of those net profits.
(2)  Any finance company which fails to comply with subsection (1) shall be liable on conviction to a fine not exceeding $20,000 and, in the case of a continuing offence, to a further fine of $2,000 for every day during which the offence continues after conviction.
Maintenance of adequate provision for bad and doubtful debts
18A.  Every finance company shall make provision for bad and doubtful debts and, before any profit or loss is declared, ensure that the provision is adequate.”.
Repeal and re-enactment of section 20
7.  Section 20 of the principal Act is repealed and the following section substituted therefor:
Publication and exhibition of audited balance-sheet
20.—(1)  Every finance company shall exhibit in a conspicuous position in each of its offices and branches in Singapore —
(a)a copy of its latest audited annual balance-sheet and profit and loss account, together with any notes thereon, and a copy of the report of the auditors; and
(b)the full and correct names of all persons who are directors for the time being of the finance company.
(2)  Every finance company shall, within 6 months after the close of each financial year or within such period as the Authority may approve, publish in at least 4 local daily newspapers, one each published in the Malay, Chinese, Tamil and English languages, a copy of its latest audited annual balance-sheet and profit and loss account, containing at least such information as the Authority may require by notice in writing.
(3)  The Authority may by notice in writing require a finance company to publish in addition to its balance-sheet and profit and loss account under subsection (2) such additional information relating to the accounts of that finance company for any financial year as the Authority thinks fit.
(4)  A copy of the documents referred to in subsections (1) and (2) shall be sent to the Authority by the finance company, prior to its first publication in any newspaper under those subsections, together with a copy of the directors’ report.
(5)  The annual balance-sheet and profit and loss account of the finance company referred to in subsections (1) and (2) and the half year interim profit and loss account of the finance company shall be in such form as the Authority may approve.
(6)  The Authority may require any finance company to submit such further or additional information as it may consider necessary either by way of explanation, amplification or otherwise with regard to the balance-sheet and profit and loss account sent by that finance company under subsection (4) and that information shall be submitted within such period and in such manner as the Authority may require.
(7)  Any finance company which fails to comply with this section shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $5,000 and, in the case of a continuing offence, to a further fine of $1,000 for every day during which the offence continues after conviction.”.
New sections 21A and 21B
8.  The principal Act is amended by inserting, immediately after section 21, the following sections:
Monthly statements of advances, loans and credit facilities
21A.—(1)  Every finance company shall send to the Authority, not later than 15 days after the last day of each month, a statement in the form determined by the Authority showing the particulars of all advances, loans and credit facilities granted by the finance company as at the end of that month to —
(a)any of the directors of the finance company;
(b)any firm in which the finance company or any of its directors is a partner, manager or agent;
(c)any individual or firm of whom or of which any of the directors of the finance company is a guarantor;
(d)any corporation that is related to the finance company;
(e)any of the finance company’s officers, employees or other persons receiving remuneration from the finance company (other than persons receiving remuneration in respect of their professional services);
(f)any private or public company in which the finance company or any of its directors, officers, employees or other persons who receive remuneration from the finance company has an interest as a director, manager, agent or guarantor; or
(g)any individual in whom, and any firm or company in which, any of the directors of the finance company has, whether directly or indirectly, such interest as is required to be declared under section 21B, other than those advances, loans and credit facilities, the particulars of which have been supplied pursuant to paragraphs (a) to (f).
(2)  Where it appears to the Authority, on examination of the particulars supplied by a finance company under subsection (1), that any advance, loan or credit facility has been or may be granted to the detriment of the interests of the depositors of the finance company (referred to in this subsection as the advance, loan or credit facility), the Authority may as it thinks fit by notice in writing —
(a)prohibit that finance company from granting any further advance, loan or credit facility to the borrowers which in the Authority’s opinion may be detrimental to the interest of the depositors;
(b)impose restrictions on that finance company in relation to the grant of any advance, loan or credit facility; or
(c)direct that finance company to secure repayment of any advance, loan or credit facility.
(3)  In this section —
(a)“director” includes the wife, husband, mother, father, son or daughter of a director; and
(b)whether a corporation is related to a finance company shall be construed in accordance with section 6 of the Companies Act (Cap. 50).
Disclosure of interest by directors
21B.—(1)  Subject to this section, every director of a finance company who is in any way, whether directly or indirectly, interested in an advance, loan or credit facility or proposed advance, loan or credit facility from that finance company, shall as soon as practicable declare the nature of his interest to the board of directors of that finance company and the secretary of the company shall cause the declaration to be circulated forthwith to all the directors.
(2)  Subsection (1) shall not apply in any case where the interest of the director of a finance company consists only of being a member or creditor of a company which is interested in an advance, loan or credit facility or proposed advance, loan or credit facility from that finance company if the interest of the director may properly be regarded as not being a material interest.
(3)  For the purposes of subsection (1), a general notice given to the board of directors of a finance company by a director to the effect that he is an officer or member of a specified company or a member of a specified firm and he is to be regarded as having an interest in any advance, loan or credit facility which may, after the date of the notice, be made to that company or firm shall be deemed to be a sufficient declaration of interest in relation to any advance, loan or credit facility so made if —
(a)it specifies the nature and extent of his interest in the particular company or firm;
(b)his interest is not different in nature or greater in extent than the nature and extent so specified in the notice at the time any advance, loan or credit facility is made; and
(c)it is given at a meeting of the directors or the director takes reasonable steps to ensure that it is brought up and read at the next meeting of the directors after it is given.
(4)  Every director of a finance company who holds any office or possesses any property whereby, whether directly or indirectly, duties or interests might be created in conflict with his duties or interests as director shall declare at a meeting of the directors of that finance company the fact and the nature, character and extent of such conflict.
(5)  The declaration referred to in subsection (4) shall be made at the first meeting of the directors held —
(a)after he becomes a director of the finance company; or
(b)if already a director, after he commences to hold the office or to possess the property.
(6)  The secretary of a finance company shall cause to be brought up and read any declaration made under subsection (1) or (4) at the next meeting of the directors of that finance company after it is made, and shall record any declaration so made in the minutes of the meeting at which it was made or at which it was brought up and read.
(7)  Any director who contravenes subsection (1) or (4) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 3 years or to both.”.
Repeal and re-enactment of section 23
9.  Section 23 of the principal Act is repealed and the following section substituted therefor:
Dealings by finance companies and credit facilities and limits
23.—(1)  No finance company shall —
(a)accept any deposit which is repayable on demand by cheque, draft or order drawn by a depositor on the finance company;
(b)deal in any foreign currency, gold or any other precious metal;
(c)acquire stocks, shares or debt or convertible securities of any financial, commercial, agricultural, industrial or other undertaking or government which are denominated in any foreign currency;
(d)grant or permit to be outstanding to any one person or to any group of persons under the control or influence of any one person, any credit facilities if the aggregate amount of such credit facilities exceeds 25% of its capital funds or such other percentage not exceeding 100% of its capital funds as the Authority may approve;
(e)grant substantial loans which in the aggregate exceed 50% of its total credit facilities or such other percentage as the Authority may from time to time determine; or
(f)grant unsecured advances, unsecured loans or unsecured credit facilities —
(i)to any person or body of persons, whether incorporated or not, which in the aggregate and outstanding at any one time exceeds $5,000; and
(ii)which in the aggregate and outstanding at any one time exceeds 10% of the capital funds of the finance company.
(2)  Notwithstanding the provisions of subsection (1)(b) and (c), a finance company with capital funds of not less than $100 million may apply to the Authority for exemption from those provisions and the Authority may approve the application subject to —
(a)the condition that the aggregate amount of foreign currency exposure of the finance company shall not at any time exceed 10% of its capital funds; and
(b)any other condition which the Authority may think fit to impose.
(3)  Subsection (1)(d) shall not, for a period of two years from the appointed day, apply to any credit facility granted by a finance company before that day which does not comply with that provision but the finance company shall not at any time during that period —
(a)increase the amount of that credit facility; or
(b)allow that credit facility to exceed 30% of the capital funds of the finance company.
(4)  Subsection (1)(d) and (e) shall not apply to —
(a)transactions with the Government;
(b)transactions with banks; or
(c)any other type of transaction which the Authority may from time to time approve.
(5)  Subsection (1)(f) shall not apply to the purchase of —
(a)any Government securities; or
(b)any bonds issued by such statutory corporation as the Authority may, by notification in writing, determine.
(6)  All the directors of a finance company shall be liable jointly and severally to indemnify a finance company against any loss arising from the making of any unsecured advance, loan or credit facility to —
(a)any of its directors, whether those credit facilities are obtained by its directors jointly or severally;
(b)a firm in which that finance company or any of its directors has an interest as a partner, manager or agent, or any individual or firm of whom or of which any of that finance company’s directors is a guarantor;
(c)a company in which any of that finance company’s directors, whether legally or beneficially, owns more than 50% of the issued capital or in which any of that finance company’s directors controls the composition of the board of directors, but excluding any public company the securities of which are listed on the Stock Exchange of Singapore or any other stock exchange which the Authority may approve, and the subsidiaries of such public company; or
(d)a corporation that is deemed to be related to the finance company as described in section 6 of the Companies Act (Cap. 50).
(7)  In this section —
(a)“aggregate amount of foreign currency exposure” means the aggregate value of investments in securities denominated in foreign currencies which are listed on exchanges recognised by the Authority and holdings of foreign currencies;
(b)“appointed day” means the date of commencement of the Finance Companies (Amendment) Act 1994;
(c)the reference to “director” in subsection (6) includes the wife, husband, father, mother, son or daughter of a director;
(d)“substantial loan” means any credit facility granted by a finance company to a single person or to any group of persons under the control or influence of a single person which in the aggregate exceeds 15% of the finance company’s capital funds; and
(e)“unsecured advance”, “unsecured loan” or “unsecured credit facility” means any advance, loan or credit facility given without security, or in respect of any advance, loan or credit facility given with security, any part thereof which at any time exceeds the market value of the assets constituting that security, or where the Authority is satisfied that there is no established market value, on the basis of a valuation approved by it.
(8)  Any finance company which contravenes any of the provisions of this section shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000.”.
Amendment of section 26
10.  Section 26 of the principal Act is amended by deleting the words “paid-up share capital and published reserves” in the fifth line of subsection (1) and in the fifth and sixth lines of subsection (2) and substituting in each case the words “capital funds”.
Amendment of section 27
11.  Section 27 (1) of the principal Act is amended by deleting the words “paid-up share capital and published reserves” in the fourth and fifth lines and substituting the words “capital funds”.
Repeal and re-enactment of section 30
12.  Section 30 of the principal Act is repealed and the following section substituted therefor:
Notices to finance companies
30.—(1)  The Authority may, if it appears to the Authority to be necessary or expedient in the public interest or the interest of the financial system, by notice in writing to finance companies give directions or impose requirements on or relating to the activities or operations of and standards to be maintained by finance companies.
(2)  Without prejudice to the generality of subsection (1), any notice under that subsection may be given in respect of —
(a)the revaluation of the assets of finance companies;
(b)the maintenance of credit files of borrowers and classification of loans, advances and credit facilities of a finance company;
(c)restrictions on the granting of Singapore dollar credit facilities in whatever form or by whatever means to residents of Singapore where such facilities are to be used outside Singapore, or to non-residents;
(d)the appointment of directors, chief and deputy chief executive officers of a finance company;
(e)the code of conduct governing the manner and method by which a finance company solicits business and deals with its customers, the procedures for the reporting of transactions between a finance company and its employees, and conflicts of interest involving the finance company and its employees or involving the finance company and its customers;
(f)the maximum aggregate permissible percentage holdings by any class, category or description of persons of interests in shares of a finance company;
(g)the preparation by finance companies of profit and loss accounts and balance-sheets and the form and content thereof;
(h)the conditions under which finance companies can engage in the financing of trade and inventory;
(i)the forms, returns and submission of statistics for the purposes of this Act;
(j)the provision for and writing off of bad debts by a finance company.
(3)  Every finance company shall comply with any direction or requirement imposed by any notice under this section.
(4)  Every notice in writing issued by the Authority before the date of commencement of the Finance Companies (Amendment) Act 1994 (other than a notice which was issued pursuant to another provision of this Act) shall, if such notice could have been issued under this section, be deemed to be so issued on that date.”.
Amendment of section 31
13.  Section 31 of the principal Act is amended by inserting, immediately after subsection (2), the following subsections:
(3)  Where a finance company has failed to maintain the reserves required by an order made under subsection (1)(f), the Authority may by notice in writing direct that finance company to make good the deficiency within the period specified in the notice.
(4)  If the defaulting finance company fails to make good the deficiency within the period specified in the notice referred to in subsection (3), it shall be lawful, notwithstanding the provisions of any other written law, for the Authority to serve a notice in writing upon any bank with which the defaulting finance company has a credit balance, whether in current or deposit account, directing that bank to transfer to the Authority up to such amount as is specified in the notice as being equivalent to the amount of the deficiency in the minimum cash balances of the defaulting finance company required under subsection (1)(f) and the bank shall comply immediately with the requirements of that notice.
(5)  The Authority may, notwithstanding any notice given under subsection (3) or (4), impose on any finance company that fails to maintain the reserves required by an order made under subsection (1)(f) a penalty interest charge of $100 per day or such larger amount as the Authority may determine for every day during which the finance company continues to fail to maintain such reserves.”.
Amendment of section 32
14.  Section 32 of the principal Act is amended —
(a)by deleting subsection (2) and substituting the following subsection:
(2)  The minimum amount of liquid assets to be maintained by every finance company shall be determined from time to time by the Authority and shall be expressed in the form of a percentage or percentages which those assets shall bear to the liabilities of each finance company on account of deposits and other liabilities, either jointly or separately.”; and
(b)by deleting subsection (4) and substituting the following subsection:
(4)  For the purposes of this section,
“liquid assets” means —
(a)notes and coins that are legal tender in Singapore;
(b)Government securities;
(c)Government securities held under overnight repurchase agreements with banks in Singapore, approved primary and registered dealers in Government securities and the Post Office Savings Bank of Singapore established under the Post Office Savings Bank of Singapore Act (Cap. 237);
(d)bills of exchange denominated in Singapore dollars accepted or endorsed by at least two banks in Singapore, which arise from genuine trade transactions and are payable within 3 months; and
(e)such other assets as the Authority may from time to time specify by a notice in writing.”.
New sections 33A and 33B
15.  The principal Act is amended by inserting, immediately after section 33, the following sections:
Production orders against finance companies to produce material relating to drug trafficking
33A.—(1)  Notwithstanding section 21(2), the Attorney- General or any person duly authorised by him in writing may, for the purpose of an investigation into drug trafficking, apply to the High Court for an order under subsection (2) in relation to any particular material or material of a particular description.
(2)  The High Court may, if on such an application it is satisfied that the conditions referred to in subsection (3) are fulfilled, make an order that the finance company which appears to the Court to be in possession of the material to which the application relates shall —
(a)produce the material to the Attorney-General or the person duly authorised by him for the Attorney-General or such person to take away; or
(b)give the Attorney-General or the person duly authorised by him access to the material,
within a reasonable period, but not less than 7 days, as the order may specify.
(3)  The conditions referred to in subsection (2) are —
(a)
(i)where the application is in respect of a foreign offence, that there is a prima facie case that a specified person has carried on or has benefitted from drug trafficking; and
(ii)in any other case, that there are reasonable grounds for suspecting that a specified person has carried on or has benefitted from drug trafficking;
(b)that there are reasonable grounds for believing that the material to which the application relates —
(i)is likely to be of substantial value (whether by itself or together with other material) to the investigation for the purpose of which the application is made; and
(ii)does not consist of or include items subject to legal privilege; and
(c)that it is not contrary to the public interest to produce the material to which the application relates.
(4)  A finance company which complies with an order made under subsection (2) shall not be treated as being in breach of any restriction upon the disclosure of information or material relating to a customer’s account imposed by contract.
(5)  No action shall lie against a finance company which in good faith produces materials or gives access to materials relating to the account of its customer by reason of that finance company having made the production or given access in compliance with an order made against it under subsection (2) or any act done or omitted to be done in relation to the funds, investment or property in the account of that customer in consequence of the production of or access to those materials.
(6)  The proceedings for an application of a production order under this section shall be heard in camera.
(7)  In this section —
“drug trafficking” or “foreign offence” have the same meanings as in the Drug Trafficking (Confiscation of Benefits) Act (Cap. 84A);
“items subject to legal privilege” has the same meaning as in section 33(2) of the Drug Trafficking (Confiscation of Benefits) Act.
Production orders to obtain information to assist foreign authority investigating drug trafficking
33B.—(1)  The Attorney-General or any person duly authorised by him in writing may make an application under section 33A for the purpose of assisting a foreign authority in its investigation into a foreign offence if and only if the conditions in subsection (2) are fulfilled in addition to those in section 33A(3).
(2)  The conditions referred to in subsection (1) are —
(a)there exists a mutual legal assistance treaty, memorandum of understanding or other agreement or arrangement in drug-related matters between Singapore and the foreign government and the conditions therein have been fulfilled in respect of any particular request for assistance from the Attorney-General, which conditions shall be in addition to and not in derogation of the conditions in this subsection;
(b)the foreign authority has agreed to provide reciprocal assistance in drug-related matters to Singapore;
(c)the foreign offence which is the subject of the investigation constitutes an offence against the law of or of a part of the State of the foreign authority and the act or omission constituting the offence or the equivalent act or omission would, if it had occurred in Singapore, have constituted an offence under the Drug Trafficking (Confiscation of Benefits) Act (Cap. 84A) or the Misuse of Drugs Act (Cap. 185);
(d)the seriousness of the foreign offence under investigation is of sufficient gravity and the material which is the subject of the application is of sufficient importance to the investigation and whether the material could not reasonably be obtained by other means;
(e)the assistance is not likely to prejudice the sovereignty, security or other essential interests of Singapore;
(f)it is appropriate in the public interest to give the assistance sought;
(g)the foreign authority undertakes that the material sought if granted by the High Court pursuant to a production order shall not be used for any other purposes except for the investigation of the foreign offence or for the prosecution of the offender concerned and the material shall be returned to the Attorney-General upon completion of the investigation or the proceedings against the offender; and
(h)such other conditions as the Minister may prescribe.
(3)  The proceedings for an application for a production order under subsection (1) shall be heard in camera.
(4)  In this section —
“drug-related matters” includes the subject of mutual assistance in the investigation of drug trafficking offences within the meaning of the Drug Trafficking (Confiscation of Benefits) Act (Cap. 84A);
“foreign authority” means a foreign government or an appropriate authority designated by a foreign government exercising any function corresponding to a function of the Minister in charge of the Drug Trafficking (Confiscation of Benefits) Act or the Misuse of Drugs Act (Cap. 185);
“foreign country” means any country or territory outside Singapore;
“foreign government” means the government of a foreign country;
“foreign offence” has the same meaning as in the Drug Trafficking (Confiscation of Benefits) Act (Cap. 84A).”.
Amendment of section 57
16.  Section 57 of the principal Act is amended by inserting, immediately after subsection (2), the following subsection:
(3)  Such regulations may provide that a contravention of any provision thereof shall be an offence and shall be punishable with a fine not exceeding $5,000 or with imprisonment for a term not exceeding one year or with both as may be specified in the regulations.”.