MAS Issues Guidelines on Fair Dealing - Board and Senior Management Responsibilities for Delivering Fair Dealing Outcomes to Customers
Singapore, 3 Apr 2009...MAS has issued the Guidelines on Fair Dealing - Board and Senior Management Responsibilities for Delivering Fair Dealing Outcomes to Customers (Click here to view the Guidelines) (100 KB) to promote fair dealing by financial institutions when they conduct business with their customers.
2 The Guidelines emphasise the responsibilities of the Board and Senior Management of financial institutions to deliver fair dealing outcomes when providing financial advisory services to customers. There is a deliberate focus on outcomes in the Guidelines as customers are concerned about their experiences when dealing with financial institutions, and whether the investment products and services they buy provide real value.
3 The Guidelines set out five fair dealing outcomes. The Guidelines are to be read together with the Financial Advisers Act, and apply to the selection, marketing and distribution of investment products and the provision of advice for these products. They also cover responsibilities for after-sales services and complaints handling. The five fair dealing outcomes are:
(i) Customers have confidence that they deal with financial institutions where fair dealing is central to the corporate culture.
(ii) Financial institutions offer products and services that are suitable for their target customer segments.
(iii) Financial institutions have competent representatives who provide customers with quality advice and appropriate recommendations.
(iv) Customers receive clear, relevant and timely information to make informed financial decisions.
(v) Financial institutions handle customer complaints in an independent, effective and prompt manner.
4 The five fair dealing outcomes provide clear benchmarks for MAS and the industry for assessing the success of financial institutions in promoting good market conduct practices. MAS will consider financial institutions’ ability or failure to observe the Guidelines in assessing whether they continue to be fit and proper to conduct regulated activities.
5 Shane Tregillis, Deputy Managing Director, Market Conduct, MAS said, “Financial institutions will need to work hard to regain the confidence and trust of their customers. MAS expects the Board and Senior Management of all relevant financial institutions to be able to clearly demonstrate that their strategy, policies, systems and processes support the five fair dealing outcomes."
6 MAS thanks respondents for their feedback on the Guidelines when they were released for consultation in February 2008. MAS will update the Guidelines, where appropriate, to incorporate comments received on the Consultation Paper on “Review of the Regulatory Regime Governing the Sale and Marketing of Unlisted Investment Products", as well as industry developments in Singapore and other jurisdictions.
7 MAS encourages industry and consumer associations to play an active role in promoting fair dealing outcomes for customers. We will work with our MoneySENSE partners to enhance current financial education efforts. MAS will issue consumer guides and support activities to help consumers understand the Guidelines and what they can expect from their financial institutions.