Complaints against financial sector account for humble 3% of total in France in 2016
It would be unlikely that a regulator would focus on financial fraud, given that consumer complaints against the banking and finance sector are rare.
FinanceFeeds has been keeping its readers informed about the regulation of the financial services sector in France, especially given the implications that the Sapin 2 law has for the online trading industry.
This law prohibits advertising of high-risk financial products, including certain CFDs and binary options. The move has even affected partnerships between football teams and binary options brands, as these were seen to result in advertising of high-risk financial products too, and thus fell under the scope of the law.
France’s financial markets’ regulator AMF has played an instrumental role in drafting the law and its implementation. The regulator has alerted of heavy sums lost by French investors due to online trading, and it has also published “black lists” of unregulated binary options and Forex brokers.
These measures and announcement have led us to think that tackling financial fraud is high on the agenda for France’s regulators. It felt as though banning risky financial products ads is a key priority.
There seems to be another side to the story and it is revealed in the Activities Report for 2016, just published by the General Directorate for Competition Policy, Consumer Affairs and Fraud Control (DGCCRF). The agency is a part of France’s Ministry for the Economy and Finance.
The agency received 69,153 claims against various businesses in 2016, with a meager 3% of these concerning banking and finance. Practically all other industries, with the exception of utilities, were targeted by more complaints. The French are complaining about food quality, electrical appliances, cars, property, etc. Finance is not at the center.
This result is important to take into account when we consider why a regulator is not reacting fast against an illegal binary options broker or taking measures against a certain FX company. The answer is simple – this is not a priority. And it is not a priority because investors do not complain.