The presence of professionals in the financial markets authority sanctions Committee is decidedly not self-evident. The Council of State has set aside sanctions imposed in April 2006 by the commission in the Global Equities folder. The blame and the penalty of inflicted EUR 3 million to the company are thus abolished, and the blame and the fine of 60,000 euros against Gilles Boyer, its current President. The administrative judge has also repealed the blame and the fine of 700,000 euros to Patrick Piard, former President of Global Equities, so that the blame and the 150,000 euros delivered against Global Management.
This is the third time in less than a year that the basis of impartiality is successfully raised by persons sanctioned by the Constable of the stock market. The three cases are of course different. But all are based on the presence of professionals in the body of sanction of the MFA. In the case of Global Equities, "it is argued that the principle of impartiality was infringed because the functions in society Fellowship Exane, concurrent of the company Global Equities with the civil aviation professional flight personnel pension fund by the rapporteur". For memory, the assent procedure, the rapporteur instructed record, conducts hearings, is preparing a report and presents the case at the meeting of sanction.
The Member of the commission of the relevant sanctions, Pierre Lasserre, exercised the functions of administrator at the time of the facts (1999-2001) then Adviser of the President of Exane. For the Council of State, the situation of competition of two intermediaries, clearly established, "barred" to what the individual virtual functions of rapporteur. The fact that the Fund represented only a very small share of the turnover of Exane or competition situation ceased in 2004 not detract, considers the administrative law judge or the absence of voting of the rapporteur. This "breach of the principle of impartiality" is likely to result in the cancellation of the penalty, concluded the Council of State, which thus confirms its extensive reading of this principle.
It is a hard blow to the MFA. The institution was "concerned" about these decisions "which could affect the operation of the system established by the legislature, that the sanctions Committee should be composed in majority of professionals". A device regarded as a step forward with the creation of the MFA in 2003. At the presentation of the annual report of the authority, its Chairman, Michel Prada, had already recognized that the decisions of the Council of State related to the principle of impartiality "problem". A "mechanism to respond to the concerns of the High Court and secure procedure of sanction on impartiality objective and apparent of the members of the commission of the sanctions" is already in study, shows to the AMF. A challenge procedure could therefore quickly be proposed in the draft laws currently in preparation. The Council of State is called explicitly noting that "no provision allowed Global Equities to challenge the rapporteur". It is now urgent.
Avoiding conflict of interest
The need for the MFA to solve this problem is much greater more widely claimed a revision of its device of sanction. In particular, it wishes to obtain the opportunity for the College, as the prosecution authority, appeal concurrently persons sanctioned, to avoid undue actions, but also the increase of its scale of sanctions review and the establishment of a mechanism of transaction. In addition, maybe the profile of the persons in the future to sit in the sanctions Committee will be analyzed taking also into account the potential level of risk of conflict of interests which could expose the Constable of the stock market.