Regulatory Alerts2020-09-30
Added · Updated
Findings of Mystery Shopping Programme on Selling Practices of Authorized Institutions in respect of Investment and Insurance Products
The Hong Kong Monetary Authority issued this report detailing the results of a mystery shopping programme conducted between 2018 and 2020 to assess the selling practices of 20 retail banks regarding investment and insurance products. The findings indicate that while banks are largely compliant with regulatory requirements, significant improvements are needed in Know-Your-Customer procedures, suitability assessments, and the disclosure of product features and risks. Specific deficiencies included sales staff influencing risk profiling answers, failing to adequately explain risks such as credit and liquidity issues, and recommending products that did not match customer circumstances.
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