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The AFM imposes an administrative penalty on Lancelot for not obtaining sufficient information with respect to asset management

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On 15 July 2010, the Netherlands Authority for the Financial Markets (AFM) imposed an administrative fine of € 6,000 on Lancelot Vermogensbeheer B.V. (Lancelot). Lancelot managed the individual assets of clients, while it failed to obtain sufficient information to determine the manner of management. It is therefore not clear whether the manner of management was in the interest of the client.

The AFM has investigated ten Lancelot files from the period of 1 April 2008 to 5 October 2009. All ten files concern investments with partially borrowed money.

In all of the ten files investigated, Lancelot had failed to obtain sufficient information on the client's objectives and degree of risk acceptance. This means that Lancelot was unable to sufficiently establish that the transactions to which its management related, complied with the investment objectives of the relevant clients.

In four of the ten files investigated, Lancelot had failed to obtain sufficient information on the consumer's financial position. This means that Lancelot was unable to sufficiently establish that the transactions to which its management related where of such a nature that the clients involved were able to financially shoulder the investment risks related to their objectives.

In six of the ten files investigated, Lancelot failed to obtain sufficient information on the client's knowledge and experience. This means that Lancelot was unable to sufficiently establish that the transactions to which its management related were of such a nature that the clients involved, in view of their knowledge and experience, were able to understand what investment risks were attached to the transactions or to the management of their portfolio.

Lancelot has consequently violated Article 4:23, first paragraph, of the Financial Supervision Act. This provision obliges financial undertakings that manage the individual assets of clients to obtain sufficient relevant information on the financial position, knowledge, experience, objectives and risk acceptance of the client involved (the client profile), in the interest of the client. The financial undertaking has to ensure that the advice is based in part on the information obtained.

If you have any questions or comments you can contact the Financial Markets Information Line on: 0900-5400 540 (5 eurocents per minute).

The AFM promotes fairness and transparency within financial markets. We are the independent supervisory authority for the savings, lending, investment and insurance markets. The AFM promotes the conscientious provision of financial services to consumers and supervises the honest and efficient operation of the capital markets. Our aim is to improve consumers’ and the business sector’s confidence in the financial markets, both in the Netherlands and abroad. In performing this task the AFM contributes to the prosperity and economic reputation of the Netherlands.

The AFM is committed to promoting fair and transparent financial markets.

As an independent market conduct authority, we contribute to a sustainable financial system and prosperity in the Netherlands.

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