The AMF Enforcement Committee fines an asset management company and its directors for breaches of their professional obligations

After dismissing the procedural arguments put forward by the respondents, the Commission identified four series of failings.

Firstly, the Commission found that Horizon Asset Management had not honoured the commitment made in its authorisation application to transform three investment vehicles described as "club deals" into alternative investment funds. It also found that the asset management company had failed in its obligation to appoint a depositary for these funds.

The Commission then noted that the asset management company had not formalised the procedures for selecting its service providers for its property construction and renovation business. It also found that it did not have a procedure for monitoring any work budget overruns and their impact on project profitability.

The Commission further condemned the failure to establish a written procedure for the valuation of property assets until May 2019, and the fact that this procedure was not operational after that date. It also condemned the lack of documentation and traceability of the asset valuation process, as well as the lack of control over the procedure and methods used to value the assets held by the funds under management. In addition, it found that Horizon Asset Management had not put the service provider it had appointed in a position to carry out the compliance and internal control tasks it had entrusted to it.

Finally, the Commission considered that the asset management company did not have an effective conflict of interest mapping until March 2018 and that, after this date, the procedure for managing conflicts of interest was deficient and that the register of conflicts of interest was incomplete. The Commission also found that the mapping did not provide for measures to manage a conflict of interest situation relating to the acquisition by the Chairman of Horizon Asset Management of a property owned by vehicles managed by the asset management company. In addition, it noted that the holders of the alternative investment funds concerned by this conflict of interest had not been informed. Finally, the Commission considered that Horizon Asset Management had not justified the payment of a brand fee by three funds to a fourth, all of which it managed. 

The Commission found that the breaches held against Horizon Asset Management were attributable to its chairman and its managing director in charge of compliance and internal control at the time of the events until his departure from the asset management company on 30 June 2020.

An appeal may be lodged against this decision.
 

About the Enforcement Committee
The Enforcement Committee, which is made up of judges and professionals, has total freedom to make decisions. It can impose sanctions on any person or company whose practices contravene laws and regulations that fall within the jurisdiction of the AMF. It ratifies settlement agreements signed by the Secretary General and respondents. And it takes part in the AMF’s educational efforts by clarifying financial regulations when explaining its decisions.