The AMF Enforcement Committee fines a portfolio asset management company for breaches of its professional obligations
Executive Summary
The AMF Enforcement Committee fined an unnamed portfolio asset management company €400,000 for multiple breaches of professional obligations, including non-operational investment/divestment procedures, inadequate conflict of interest management with group service providers, lack of transparency on distributor fee retrocessions, deficient client categorization, and weak AML/CFT due diligence. This enforcement action, mirroring recent similar cases against firms like Novaxia Investissement and Eternam, underscores the AMF's heightened scrutiny on operational robustness and transparency in asset management, serving as a critical reminder for firms to ensure procedures are fully implemented and documented to avoid personal liability for executives. #
What Changed
This is an enforcement decision rather than new legislation, but it reinforces and clarifies existing regulatory requirements under AMF professional obligations for portfolio asset managers (sociétés de gestion de portefeuille). Key emphases include: - Investment/divestment processes must be fully operational, with traceability of compliance checks against fund policies and formalized due diligence before allocations. - Effective conflicts of interest policies are mandatory when using group service providers, with comprehensive, accurate investor disclosures on related remuneration. - Full transparency required on retrocessions of management fees to distributors, including justification of added value. - Robust client categorization and AML/CFT systems, including operational procedures, ri
What You Need To Do
- Audit internal procedures
- Enhance conflict and transparency controls
- Strengthen AML/CFT and client categorization
- Senior manager accountability
- Mock AMF inspections
Key Dates
Compliance Impact
Urgency: High - Recent cluster of identical fines (€200k-€500k total per case) in late 2025 signals AMF's enforcement priority on operational deficiencies in asset management, with personal sanctions escalating risks for leadership. Firms with similar setups (group providers, AIFs/club deals) face imminent inspection risk; non-compliance could trigger fines, reputational damage, and appeals proces
Who is Affected
Summary
Sanctions & settlements Journalists The AMF Enforcement Committee fines a portfolio asset management company for breaches of its professional obligations