The Netherlands Authority for the Financial Markets (AFM) announces that on 6 February 2009 it imposed an administrative penalty of € 30,000 on Postbank N.V., because it failed to obtain sufficient information during remortgaging and taking out life insurance. The violations were identified during the AFM’s market-wide investigation into mortgage advice conducted in 2007. The AFM investigated a total of 48 instances where the Postbank issued advice.
In the period of 1 January 2007 to 15 March 2007, the Postbank, in its advisory capacity with respect to remortgaging and taking out life insurance, failed to obtain sufficient information in fourteen out of forty-eight instances in which it issued advice. When issuing advice, a mortgage consultant is required to request information from its client concerning the client’s financial position, knowledge, experience, objective and willingness to accept risk. This information is required in order to issue advice that is suitable to the client’s specific situation.
The Postbank failed to obtain information on the costs of remortgaging (penalty interest) and any current life insurance with respect to the advice investigated by the AFM. No information was obtained on the financial position of the surviving partner during the Postbank’s advice on taking out life insurance. These details are relevant to determine whether the advice to remortgage and/or take out life insurance is suitable to the client. This means that the Postbank did not issue suitable advice and therefore violated Article 4:23(1) of the Financial Supervision Act (Wft).
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