The Netherlands Authority for the Financial Markets (AFM) has imposed three fines on Saxo Bank A/S totaling 1.6 million euros for violations by BinckBank NV, a broker that offered online investment services and was acquired by Saxo Bank in 2019.
AFM research shows that BinckBank acted contrary to the rules for asset separation, risk management and careful customer treatment during the migration to Saxo Bank.
The AFM started an investigation in 2022 based on signals from consumers and a critical assurance report from BinckBank’s accountant. Consumers complained on review websites and in the media about delayed transactions, incorrectly charged fees and untraceable shares. The AFM found that BinckBank did not maintain accurate administration of investment portfolios, had insufficient control over critical business processes and did not act sufficiently in the interests of its customers.
The first fine of 500,000 euros was imposed due to serious deficiencies in the administration of investment portfolios, as a result of which it could no longer be determined with certainty to whom investments and funds belonged. BinckBank has thus violated the asset separation rules. As a result, investors would be insufficiently protected in the event of a bankruptcy, BinckBank lost overview of its investment portfolios and there was also a risk that securities were lent without the consent of customers.
The second fine of 500,000 euros was imposed because BinckBank had insufficient control over the business processes with which it should have limited the risk of loss or reduction of investors’ shares and funds. Many of the controls on these processes were carried out late, ineffectively or not at all.
The third fine of 600,000 euros was imposed due to customer treatment. Investors encountered all kinds of problems in the period surrounding the migration. They were faced with, among other things, amounts transferred too late, transactions processed too late and costs and taxes charged too much. Customers who wanted to switch brokers experienced serious delays in transferring their portfolios. This was not only a problem for investors, but also for other banks and brokers who were unable to properly serve their new customers. BinckBank customers were unable to get help with their problems and concerns. Customer service was regularly poor or unavailable, provided incorrect information or made promises that were not kept. Customers posted hundreds of complaints on review websites expressing their feelings of frustration and powerlessness.
Source: www.emerce.nl
