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SEC suspends approval for two investment consultants



Thursday 1 February 2018 | No. 10 / 2018


Bangkok, 1 February 2018 - The SEC has suspended approval for two securities investment consultants of KASIKORNBANK PCL. (KBANK) for failure to perform duties with responsibility and professional due care for the best interest of investors.

The suspended persons are (1) {A} and (2) {B}.

According to a report from KBANK and the SEC's further inspection, {A} was found to have signed on a unit subscription order of a client without contacting or giving advice to the client. She admitted having done so without providing details on the fund to the client. The SEC has therefore imposed a 40-day suspension on {A}, effective from 1 November 2017. 

In the case of {B}, she committed similar acts by signing on the subscription order of a client without contacting or giving advice to the client. Instead, another KBANK employee who was not an approved investment consultant gave advice to the client in such a way that caused the client to misunderstand that the investment was a deposit transaction because the return rate and the investment term were written on the cover of the client's fund book. The SEC has therefore suspended approval for {B} as a securities investment consultant for a period of two years, starting from 1 February 2018. In addition, since {B} is also a branch manager of the bank, she is prohibited from functioning as branch manager responsible for capital market business of any bank or intermediary during the same suspension period. 

The SEC's inspection of these cases was proceeded with KBANK's cooperation. Since the incidents, KBANK has specified that only approved investment consultants are allowed to contact and give investment advice to clients.

The SEC has emphasized to all intermediaries to strictly instruct their investment consultants to obtain and compile sufficient information for client due diligence ? e.g., clients? investment objectives, personal conditions and risk tolerance ? before giving advice, attached with supporting reasons, on suitable funds for their investment. In addition, clients should be given more than one choice of fund, and intermediaries should follow up on clients? investments on a regular basis and keep clients informed of changes for clients? benefits.  


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Note: The misconduct of the investment consultants, one of whom was also branch manager,  is a violation of Clause 23(2), and a prohibited characteristic of capital market personnel under Clause 31(1) of the Notification of the Capital Market Supervisory Board No. Tor Lor Thor. 8/2557 Re: Rules on Capital Market Business Personnel dated 3 June 2014.
 













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No. 10 / 2018 Thursday 1 February 2018
SEC suspends approval for two investment consultants

Bangkok, 1 February 2018 - The SEC has suspended approval for two securities investment consultants of KASIKORNBANK PCL. (KBANK) for failure to perform duties with responsibility and professional due care for the best interest of investors.

The suspended persons are (1) {A} and (2) {B}.

According to a report from KBANK and the SEC's further inspection, {A} was found to have signed on a unit subscription order of a client without contacting or giving advice to the client. She admitted having done so without providing details on the fund to the client. The SEC has therefore imposed a 40-day suspension on {A}, effective from 1 November 2017. 

In the case of {B}, she committed similar acts by signing on the subscription order of a client without contacting or giving advice to the client. Instead, another KBANK employee who was not an approved investment consultant gave advice to the client in such a way that caused the client to misunderstand that the investment was a deposit transaction because the return rate and the investment term were written on the cover of the client's fund book. The SEC has therefore suspended approval for {B} as a securities investment consultant for a period of two years, starting from 1 February 2018. In addition, since {B} is also a branch manager of the bank, she is prohibited from functioning as branch manager responsible for capital market business of any bank or intermediary during the same suspension period. 

The SEC's inspection of these cases was proceeded with KBANK's cooperation. Since the incidents, KBANK has specified that only approved investment consultants are allowed to contact and give investment advice to clients.

The SEC has emphasized to all intermediaries to strictly instruct their investment consultants to obtain and compile sufficient information for client due diligence ? e.g., clients? investment objectives, personal conditions and risk tolerance ? before giving advice, attached with supporting reasons, on suitable funds for their investment. In addition, clients should be given more than one choice of fund, and intermediaries should follow up on clients? investments on a regular basis and keep clients informed of changes for clients? benefits.  


___________________________


Note: The misconduct of the investment consultants, one of whom was also branch manager,  is a violation of Clause 23(2), and a prohibited characteristic of capital market personnel under Clause 31(1) of the Notification of the Capital Market Supervisory Board No. Tor Lor Thor. 8/2557 Re: Rules on Capital Market Business Personnel dated 3 June 2014.