The AMF Enforcement Committee fines a portfolio asset management company and its manager for breaches of their professional obligations

What Changed

• This is an enforcement decision, not a new regulation, but it reinforces existing AMF requirements under French Monetary and Financial Code (e.g., Article L. 214-24-1) for asset managers:
• Asset management companies (sociétés de gestion) are restricted to specific investment services; providing placement of financial instruments without firm commitment (as a tied agent) circumvents these limits and is prohibited.
• Investment systems must be operational with precise allocation rules between funds; lack of traceability in verifications violates due diligence obligations.
• Firms must maintain effective conflict-of-interest identification, prevention, and management processes.
• AML/CFT systems require operational due diligence, including adequate client and asset verification; deficiencies here trigger sanctions. These align with prior AMF positions but clarify enforcement priorities through detailed findings on "non-opera

Suggested Considerations

• Audit investment services scope to ensure no unauthorized placement activities, especially if acting as tied agents; cease and remediate any circumventions.
• Enhance investment allocation processes with precise rules, full traceability of verifications, and demonstrable operationality.
• Strengthen conflict-of-interest frameworks with identification, prevention, and management protocols, including documentation.
• Overhaul AML/CFT systems for effective due diligence on clients, assets, and risks; conduct staff training and test operationality.
• Review manager accountability: responsible managers should self-assess oversight of compliance functions.
• Document all remediation; prepare for AMF inspections by maintaining audit trails.

Key Dates

Who is Affected