How FINMA Helps Investors and Individuals – Part 2

1. Take time for consideration of your investment decisions. Do not let yourself be put under pressure. You have to diversify your investments. Do not place everything in one project.

2. Before investing, plan and go in for your analysis and research of the providers and products. The splendid brochures or telephone calls are not the right marketing. Better use Google or other search engines to research providers and products.

3. Check whether FINMA authorised the provider. This is one of the most important things investors and individuals have to do. The list of supervised institutions you may find here: www.finma.ch/d/beaufsichtigte. However, it would help if you remembere that not every company that is supervised by FINMA is subject to intensive ongoing (i.e. prudential) supervision. Investors should also consider reviewing FINMA’s emergency plans, which demonstrate how key institutions respond in crisis scenarios and what protection measures are in place.

4. Check whether the provider's name is in the FINMA warning list or the IOSCO Investor Alerts Portal (www.iosco.org/investor_protection/?subsection=investor_alerts_portal). If so, FINMA advises that you make the uttermost caution and restraint. Recent enforcement examples, such as FINMA actions against a bank CEO for insider trading, illustrate the real consequences of regulatory violations.

5. Check whether the Swiss provider's name is in the Commercial Register at www.zefix.ch. If you see frequent changes in company name, address or authorized signatories – pay attention and be more suspicious about such a provider.

6. If the provider or the offer is from outside Switzerland, you have to take into consideration what you will and can do if problems occur. How, against whom, where and at what cost could you assert a claim? International events such as the Coronavirus situation also impacted legal and logistical access to cross-border providers, which should be accounted for in your risk assessment.

7. Make use of relevant internet forums and consumer sites. Pay attention to posts from concerned investors or individuals who have suffered losses.

8. Do compare the products, returns and commissions with those of other providers. If they are better than those of companies authorised by FINMA, you should give warning. Even major firms such as Credit Suisse have faced scrutiny for questionable practices, reminding investors that even high-profile names must be evaluated critically.

9. Innovative technologies and products (e.g. virtual currencies) can be attractive, but you should remember that they are risky as well. Check the information, find out as much as you can. Invest when you are sure about what is being offered.

10. Keep in mind the important rule of investment: high returns always mean high risks. The risk of loss is often much more real than the chance of turning a profit. Recognition from international legal directories such as IFLR 1000 can be one indicator of a trustworthy advisory firm, but investors should always verify through multiple sources.