The recommendation of the Prudential Control Authority

 

It should be added that, in accordance with Article L. 612-29-1, paragraph 2, of the Monetary and Financial Code, the CPA has formulated a recommendation on the marketing of unit-linked life insurance contracts. made up of complex financial instruments ( Rec omm. n ° 2010-01 of 15/10/2010). Schematically, the CPA first of all recalls the responsibility of insurance organizations and insurance intermediaries in the information and advice given to subscribers / members in the case of financial instruments serving as a unit of account (e.g. for example, “ formula ” French-law UCITS , referred to in article R. 214-27 of the Monetary and Financial Code, equivalent foreign-law structured UCITS, and complex debt securities and equivalent financial securities issued on the foreign law basis ) . Then , the CPA draws the attention of insurance organizations and intermediaries to the objective criteria for the risk of poor marketing of life insurance contracts supported by complex financial instruments.  

“ The CPA… can do better ! ". Following the 2008/2009 financial crisis, an AMF Investor Relations Department was set up in 2010 with the aim of better understanding the behavior of savers, for example, with regard to “ complex underlying formula funds ”; and financial product marketing practices. In addition, an ordinance of January 21, 2010 established a " common pole " for the Prudential Supervisory Authority (ACP), responsible for the protection of customers of insurance organizations, and the AMF, responsible for protection. customers in the banking and financial professions, in particular credit institutions. This common pole must in particular coordinate the proposals for control priorities (and not the controls themselves) of professionals in terms of compliance with obligations towards their customers, and analyze the results of the control activity of the two authorities. with a view to offering their general secretaries the consequences and the lessons to be drawn from them (C. mon. et financ., art. L. 612-47 to L. 612-50).      

The Court of Auditors , in its investigation report on the Prudential Control Authority, presented to the National Assembly on November 23, 2011, observed that the " common pole " created to coordinate the powers of the ACP in matters protection of clients of insurance companies and those of the AMF in terms of protection of bank clients " had yet to prove its worth ". Then, the Court of Auditors sent some very sharp spikes to the ACP, in the form of advice: “The pole cannot be a simple tool for coordination between the two authorities in limited areas. Today there are a number of players in the area of ​​consumer protection of financial products : not only the AMF and the ACP, but also the Financial Sector Advisory Committee and the General Directorate for Competition, Consumer Affairs and of fraud repression (DGCCRF). This is why the pole should quickly become the place for global concerted action, failing which this plurality of players should be re-examined. Finally, it is desirable that the ACP , which today favors regulatory control of professionals, pays more attention to the concerns of consumers and savers . It could thus enrich the activities of the common pole ”(Report n ° 38 of the Finance, General Economy and Budgetary Control Committee of the National Assembly, 23/11/2011, online on the website of the 'National Assembly).