FIN-FSA issues public warning to Aurejärvi Wealth Management Ltd.
The Financial Supervisory Authority (FIN-FSA) has issued a public warning to Aurejärvi Wealth Management Ltd. During the period 1 January 2012–27 March 2013 Aurejärvi Wealth Management Ltd. has unquestionably neglected to fulfil the provisions of the Mutual Funds Act and the regulations of FIN-FSA on a fund management company's obligation to arrange its activities in a reliable manner.
The internal instructions of the company have not been updated as required in the amendments to the Mutual Funds Act and the FIN-FSA regulations on the arrangements and procedures of fund management activities. For example, the company had no written risk management principles for mutual funds. In addition, the company's internal control had been outsourced, contrary to the requirements of the Mutual Funds Act and the FIN-FSA regulation.
In its reply, the company asked FIN-FSA to take the principle of proportionality into account. This principle is applied, if it is acknowledged in binding legislation or regulations. Application of the principle means that a fund management company, within the limits allowed in legislation or regulations, may itself decide how activities should be arranged, taking into account, for example, the nature, scope and characteristics of the business. Even so, the fund management company must make sure, and if necessary prove to FIN-FSA, that it is capable of fulfilling its obligations. Thus the principle of proportionality does not mean that non-compliance with binding legislation is acceptable.
In particular, the quantity and duration of incidents of neglect indicate how reprehensible the conduct of the company has been.
This decision on a public warning is not yet legally binding. The company has the right to appeal the decision of 7 July 2014 to the Market Court within 30 days of the company's receipt of notice of said decision.
For further information please contact
- Sonja Lohse, Chief Advisor, tel. +358 10 831 5311
Appendix
- Decision by the Financial Supervisory Authority (in Finnish, pdf)