According to research conducted by the Dutch Authority for the Financial Markets in 2011, providers of financial products have improved their supervision on intermediaries.
In 2010, the Dutch Authority for the Financial Markets (“AFM”) has identified significant shortcomings with regard to chain control executed by banks and insurance companies. Providers of financial products are responsible to ensure that the distribution channels act in compliance with the legal requirements. Subsequently, said providers are obliged to guarantee the quality of the distribution channel. According to the AFM, a number of intermediaries have not been compliant with the legal requirements relating to:
customer duty of care;
In 2011, the AFM has reassessed the manner in which providers of financial products have picked up their responsibilities with regard to chain control. Said research has resulted in the following conclusions: (i) the banks and insurance companies that have participated in the survey have taken measures to improve their chain control. For example, said providers have been responding more alertly when licenses of intermediaries have been revoked by the supervisory authorities; (ii) providers have taken measures enabling them to closely monitor the quality of intermediaries. However, the AFM has identified significant differences between measures taken by providers; and (iii) settlement of portfolios resulting from the revocation of the license of an intermediary by the supervisory authority must take place within three months.