France’s AMF turns to investors in order to get extra info about marketing of financial products
The panel of investors will help the AMF get access to information disseminated to by investment service providers and asset management companies to their clients.
France’s financial markets authority AMF is aiming to tighten its control over marketing of financial products. For that purpose, the French regulator is seeking to use a new means – a panel of investors. This panel will be comprised of non-professional investors who hold various portfolios (equities, investment funds, etc).
The aim of the regulator is to get access to information that is disseminated by investment services providers and asset managers to their clients. The data provided by the panel will also be used by the Households Savings Observatory.
Let’s recall that, in October 2018, the AMF published a summary of the findings stemming from five checks related to the knowledge and experience of clients of investment firms. The checks, carried out early in 2018, were conducted under a new AMF program called SPOT. The checks uncovered both good and bad practices, but the regulator underlines that, overall, the practices related to checking clients’ knowledge of financial products have improved.
More precisely, the regulator has identified a number of good procedures. For instance, the firms are now asking their (potential) clients various questions, depending on the type of financial product offered to the client. There are bad practices that the AMF has uncovered too. For instance, some firms have asked questions that had no possible answer for “no knowledge”. Instead the options were low / medium / good knowledge. In addition, some firms still allow clients choose their profile by self-assessment.
Early in January, the AMF outlined its supervisory priorities for 2019. A great part of the AMF supervisory role is performed via inspections of regulated entities. The regulator said it aims to conduct 65 such checks in 2019. This marks a small change from 63 checks carried out in 2018.
The AMF says that the inspections are of two main kinds:
- “Classic” checks – they target major players or ones posing particular risks or ones mentioned in alerts.
- Thematic checks – they cover groups of companies as the regulator tries to assess how the entities comply with new rules.
