MMCapS XVII Final Offering Circular - Irish Stock Exchange

do not effectively allow the holder to stand ahead of senior or subordinated debt holders in the event of bankruptcy.
Approximately 56.6% of the Bank Capital Securities in the Trust Estate were issued before April 15, 2005.
There can be no assurance that the adoption of the Federal Reserve’s final regulations referred to above will
not result in the occurrence of a Capital Treatment Event for one or more issuances of Bank Capital Securities. If a
Capital Treatment Event were to occur, an Affiliated Depository Institution would be able to redeem its
Corresponding Debentures, thereby causing a mandatory redemption of the related Bank Capital Securities and, in
accordance with the Priority of Payments, a prepayment of the Notes. In addition, any disallowance of Tier 1
Capital treatment for the Bank Capital Securities or other trust preferred securities issued by an Affiliated
Depository Institution’s trust subsidiaries might, depending on the amount of its other regulatory capital, cause such
Affiliated Depository Institution to fail to meet its minimum regulatory capital requirements. Any such failure
might adversely affect the Affiliated Depository Institution’s ability to make payments on its Corresponding
Debentures.
24. Recent Insurance Regulatory Developments. The insurance industry has recently become the focus of
increased scrutiny by regulatory and law enforcement authorities as well as the public relating to allegations of
improper special payments, price-fixing, bid-rigging, improper accounting practices and other alleged misconduct,
including payments made by insurers to brokers and the practices surrounding the placement of insurance business
and the sale and use of certain “loss mitigation” or “finite” insurance and reinsurance products and transactions.
Formal and informal inquiries have been made of a large segment of the industry, and a large number of companies
in the industry, including the Affiliated Insurance Institutions and Insurance Surplus Note Issuer, have received or
may receive subpoenas, requests for information from regulatory authorities or other inquiries relating to these and
similar matters. These efforts are expected to result in both enforcement actions and proposals for new state and
federal regulation. Certain insurers have also become the subject of civil litigation (including class action suits)
relating to such matters, and it is possible that such investigations may generate additional civil litigation against
insurers, even those who do not engage in the business lines or practices currently at issue. It is impossible to predict
the outcome of these investigations or proceedings, whether they will expand into other areas not yet contemplated,
whether activities and practices currently thought to be lawful will be characterized as unlawful, what form new
regulations will have when finally adopted, or the impact, if any, of this increased regulatory and law enforcement
action and civil litigation with respect to the insurance industry on the Affiliated Insurance Institutions and
Insurance Surplus Note Issuer.
From time to time, the Applicable Regulator of the Insurance Surplus Note Issuer may issue rules or
regulations, or a state legislature may adopt new laws or amend existing laws, or the National Association of
Insurance Commissioners may amend or issue new guidelines or interpretations, that may impact the regulatory
capital treatment of its Insurance Surplus Note. There can be no assurance that such rules or regulations, if issued,
would not adversely affect the regulatory capital treatment of such Insurance Surplus Note. Such action may
provide an incentive for such Insurance Surplus Note Issuer to redeem its Insurance Surplus Note in accordance with
its terms.
25. Cayman Islands Anti-Money Laundering Provisions. The Issuer and the Administrator are subject to antimoney
laundering laws and regulations in the Cayman Islands which impose specific requirements with respect to
the obligation “to know your client.” The Issuer will require a detailed verification of each initial investor’s identity
and the source of the payment used by such investor for purchasing the Notes in a manner similar to the obligations
imposed under the laws of other major financial centers. If the Cayman Islands government determined that the
Issuer was in violation of the anti-money laundering provisions, the Issuer could be subject to substantial criminal
penalties. Payment of any such penalties could materially adversely affect the timing and amount of payments to
holders of the Notes.
26. United States Anti-Money Laundering Provisions. The Uniting and Strengthening America By Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (the “USA PATRIOT Act”), signed
into law and effective as of October 26, 2001, imposes certain anti-money laundering obligations on “financial
institutions,” including a requirement under Section 352 that each financial institution adopt an anti-money
laundering program, policy and procedures. “Financial institution” is broadly defined under the USA PATRIOT Act
to include various types of entities, including banks, broker-dealers and investment companies, among other entities.
The USA PATRIOT Act requires the Secretary of the United States Treasury Department (the “Treasury”) to issue
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