On 11 April 2016, the Netherlands Authority for the Financial Markets (Autoriteit Financiële Markten, the AFM) published a report on the quality of investment services provided by investment firms. The AFM investigated to what extent large banks, private banks and investment firms, really know their customers so that they are able to provide customers with suitable advice and proper portfolio management.
The AFM investigated a total of 20 investment firms and 88 customer files. For each file the AFM reviewed whether the data on the customer (the customer’s investment purpose, its financial position, knowledge, experience, etc.) collected by the investment firm was in order. At an average the investment firms scored a 3 out of 5 in this respect. 8 out of 20 investment firms did not have sufficient data on their customers, as a result of which the AFM is considering to impose enforcement measures. Only 2 out of 20 investment firms were deemed to obtain sufficient information on the risk appetite of their customers.
In order to assist investment firms in improving the quality of their customer files, the AFM published a report which includes examples of good practices.
View the AFM’s new item (Dutch only), 11 April 2016.
View the AFM’s report on the quality of the provision of investment services (Dutch only), March 2016.