AMF Enforcement Committee fines a financial investment advisor and its director for breaches of their professional obligations
Executive Summary
The AMF Enforcement Committee has issued multiple enforcement decisions against financial investment advisors and their management for breaches of professional obligations, with the most recent and significant case involving Carat GP and its directors receiving combined fines of €2.5 million and permanent/extended bans from operating as financial investment advisors. These cases establish critical precedent regarding advisor duties around client disclosure, product authorization, conflict of interest management, and honest/fair conduct—requirements that apply across the entire financial investment advisory sector. #
What Changed
The enforcement decisions clarify and reinforce several core professional obligations for financial investment advisors: Transparency and Disclosure Obligations Financial investment advisors must inform clients of any remuneration received for their advice and justify improvements to advisory services in return for compensation received. Advisors cannot recommend financial products without first ensuring their marketing is authorized in the relevant jurisdiction. Competence and Care Standards Advisors must conduct business with due competence, care, and diligence in the best interests of clients. This includes conducting necessary checks prior to marketing alternative investment funds (AIFs) and ensuring products are authorized for sale in France before recommending them. Conflict of In
What You Need To Do
- *Immediate Compliance Review
- *Governance and Documentation
- *Training and Culture
- *Regulatory Engagement
Key Dates
Compliance Impact
Urgency: HIGH
Who is Affected
Summary
Sanctions & settlements professional obligations Other professionals Journalists AMF Enforcement Committee fines a financial investment advisor and its director for breaches of their professional obligations