FIN-FSA issues public warning to and imposes penalty payment on Aalto Bankers Ltd
The Financial Supervisory Authority (FIN-FSA) conducted in 2017 an inspection at Aalto Bankers Ltd regarding compliance with the obligation to obtain information in connection with investment advice provided by the company and the company’s obligation to provide the customer with information on matters important for the selection of investments linked to an insurance policy. The inspection focused on examining the company's practices in selling investment fund products and structured investment products to non-professional investors aged over 65.
The inspection of investment advice conducted by the FIN-FSA identified several cases of non-compliance with the company's obligation to obtain adequate information on the customer and to ensure the suitability of transactions for the customer prior to offering relevant investment advice. The inspection also revealed that the company had failed to store information on the investment advice services provided to customers in such a way that the information would have enabled ex post verification of the course of events.
In the inspection, FIN-FSA found that in acting as an insurance agent, the company failed to comply with the obligation to provide the customer with necessary information on complex structured investment products linked to an insurance policy.
The FIN-FSA has issued a public warning to the company and imposed on the company a penalty payment of EUR 20,000.
The FIN-FSA has applied to the cases of non-compliance the provisions in force at the time of non-compliance, and therefore the public warning was issued for non-compliance with the obligation to obtain information and conduct suitability assessments and for non-compliance with the obligation to provide information regarding investments linked to an insurance policy. The penalty payment, in turn, was imposed for omissions regarding documentation requirements.
Determination of the size of a penalty payment is based on a comprehensive assessment, taking into account, among other things, the nature, extent and duration of the act. The penalty payment is payable to the State.
The decision of the FIN-FSA is not yet legally binding. The company has the right to appeal the decision of 17 August 2018 to the Helsinki Administrative Court within 30 days of receipt of notice of said decision.
The FIN-FSA issued in spring 2017 public warnings to and imposed penalty payments on four companies for similar cases of non-compliance regarding investment advice. The FIN-FSA considers the obligations concerning investment advice as important in terms of investor protection and will also in future direct supervisory measures at this area of activity.
- Sonja Lohse, Head of Director General's Staff, Chief Advisor.
- Requests for interviews are coordinated by FIN-FSA Communications, tel. +358 9 183 5030, weekdays 9.00–16.00.
FIN-FSA's decision (pdf, in Finnish)