The Sanctions Committees Of The French Financial Regulators: Overview Of The Activity In 2016

Author:Mr Daniel Kadar and Ron Shalit
Profession:Reed Smith (Worldwide)
 
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In 2016, the French financial regulators, the ACPR and the AMF, continued to pay particular attention to infringements in matters of anti-money laundering and anti-terrorism, internal control procedures, conflicts of interest and market abuses. Read our client alert below for more detail.

In 2016, the Autorité de contrôle prudentiel et de résolution ('ACPR') and the Autorité des marchés financiers ( 'AMF') continued to pay particular attention to infringements in matters of anti-money laundering and anti-terrorism, internal control procedures, conflicts of interest and market abuse.

As in previous years, financial penalties dominate the wide range of sanctions available to the sanctions committees of these bodies. The level of fines imposed varies widely, having regard to the seriousness of the failure and remedial measures taken.

Matters of greatest concern to the French financial regulators

A review of the cases of the ACPR and AMF sanctions committees over the last five years reveals that several matters appear to be of special concern to the French regulators. Most of the decisions concern violations of statutory obligations in the following matters:

Anti-money laundering and anti-terrorist financing Internal control procedures Conflicts of interest Market abuse (i.e. insider trading, market manipulation, misinformation) Prevalence of pecuniary sanctions

The financial regulators' powers of sanction have been significantly widened over the last decade to make sanctions a more effective deterrent. This follows a ten-fold increase in maximum fines from €10 million to € 100 million in 2010.

Banks and other financial market participants who are under the supervision of the French financial regulators may be subject to a wide variety of sanctions, ranging from a warning, a reprimand, a temporary suspension or a compulsory resignation of senior managers, to restrictions on the conduct of their activity and/or a financial penalty.

However, financial sanctions continue to be the most common penalty in 2016: more than 90 per cent of the decisions rendered by the sanctions committees of the French financial regulators over the last five years involve financial sanctions, with fines generally varying from €10,000 to €5 million.

In 2016, the maximum fine...

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