Patrimonia, a family office based in Belgium, was fined 40,000 euros ($47,700) this Tuesday. The small firm made a settlement with the Financial Services and Markets Authority (FSMA), a Belgian regulator.
In 2015, FSMA informed Patrimonia that its website did not comply with regulation surrounding advertising. The regulator claims Patrimonia, despite having FSMA authorization, provided misleading information that did not fit with regulatory provisions relating to insurance and advertising.
The company duly made changes to its website that it thought would be in line with FSMA regulation. In April 2017, however, the regulator said that Patrimonia was still not complying with the required regulatory standards.
Changing the Face of AML with Self Service AnalyticsGo to article >>
FSMA claims that most consumers make decisions as to whether or not purchase a financial product or service based on advertising. As such, they believe adverts should clearly state the advantages and disadvantages of a financial product.
As punitive as this law may seem (it’s hard to imagine any other industry – bar alcohol and tobacco – that would be subject to such legislation), it is also not that well defined. Patrimonia has just discovered that what appeared to them to clearly show the disadvantages of their products, was not viewed by FSMA in the same light.
The regulator says that Patrimonia’s content could be construed as misleading or inaccurate. They added that, although Patrimonia does not sell products on its website, it still had to conform to advertising regulation.
Companies that collaborate with FSMA in their investigation can agree on a settlement with the regulator. This appears to be what has happened with Patrimonia as the company finds itself 40,000 euros out of pocket.