Please note that the role of the SFEMC in an event of market disruption in Singapore depends on the nature of the event and the magnitude of its impact on the wholesale financial markets. The SFEMC is usually expected to work closely with market participants, local and overseas relevant business bodies, as well as regulators to reduce uncertainties.

Please note that the SFEMC’s role is limited to offering practical recommendations to Market Participants in order to minimize the risks created by a market disruption event. Although it is understood that market participants would have to negotiate bilaterally with their counterparties in order to obtain a satisfactory settlement of any affected transactions or commitments in compliance with any contractual terms negotiated between them.

If a Market Participant does not have ample limits to satisfy the maximum amount of the counterparty but attempts to increase limits, the Market Participant should show the amount that he can do with his current limits. In a fast-moving market, if raising limits takes too long, the broker should not be kept accountable for the balance if the counterparty has carried out the balance elsewhere. The Broker will not be held liable for the balance if the counterparty has executed the money problem.

Please note that in instances where a Market Participant hits a Broker’s quote for an amount in excess of the minimum dealing amount and the Broker can honor the full amount, the Market Participant does not insist that the whole amount be in one deal but rather should accept split amounts done reasonably. Also,the SFEMC is usually expected to work closely with market participants, local and overseas relevant business bodies, as well as regulators to reduce uncertainties.

Please note that the Guidelines have been issued by the Monetary Authority of Singapore (“MAS”) to emphasize our expectations for financial institutions and their representatives to conduct their marketing and distribution activities at retailers and public places, on the Code of Perform for Marketing and Distribution Activities (‘the Guidelines’). The Guidelines are applicable to all financial institutions engaged in marketing and distribution activities aimed at retail clients.

It is to be acknowledged that financial institutions today have various marketing and distribution arrangements to market their products and services to customers, such as roadshows and tie-ups with retailers. Such structures expand the reach of financial institutions to members of the public and can give rise to several problems if not properly handled.

Please note that customers who do not seek to purchase financial products and services may, when prospected, feel harassed or make impulse purchases. In addition, they may not be sufficiently prepared to provide the required details for a proper sales and consultation session and may face an increased risk of purchasing a product or service that is not sufficient for their needs, financial condition or risk profile

It is stated that it is common for financial institutions to set up sales booths in open and visible spaces with high foot traffic when financial institutions market and sell financial products and services at retailers and public places. In such conditions, the physical setting can not be conducive to proper sales and advisory sessions by financial institutions.

The customers might have difficulty identifying the financial institution which the representatives are acting on behalf of when financial institutions conduct marketing and distribution activities in public places or temporary locations. This is because the prospecting practices and sales and consulting sessions are not performed inside the financial institution’s premises and it may not be obvious to customers that the person they are dealing with is from a financial institution.

It is to be acknowledged that for transactions closed at retailers and public places, financial institutions can collect payments from customers in the form of cash or cheques. The mismanagement of such payments leaves financial institutions vulnerable to future financial losses or fraud.

It is to be acknowledged institution to carry out on its behalf the promotion and distribution of financial goods and services; ‘customer’ means the prospective customer. The words used in the Guidelines shall have the same meanings as defined in the relevant Acts, except where explicitly stated in the Guidelines or otherwise needed by the context.The term “representative” refers to any employee or agent that is engaged by a financial institution to conduct marketing and distribution of financial products.

MAS expects the Board and senior management of financial institutions to set the right tone for consumers in a responsible and professional manner in the conduct of marketing and distribution activities to costumers. MAS will also keep the Board and senior management responsible for ensuring that the corporate conduct standards of their financial institution are in accordance with the Guidelines’ objectives.

Please learn that the Board and senior management should ensure that the safeguards are incorporated, as appropriate, into the policies, systems, and processes of the financial institution relating to its marketing and distribution activities. They should also ensure that the risks posed by their financial institution’s marketing and distribution activities are properly assessed and addressed.

MAS expects the Board and the senior management of financial institutions to set the correct tone for customers to perform marketing and distribution operations in a responsible and professional manner. If issues arise that may compromise the interests of customers, the financial institution should consider instituting measures that are more stringent than those set out in the Guidelines.

When its representative’s prospect and close sales at retailers and public places, financial institutions should conduct call-backs or surveys to customers when their representative’s prospect and close sales at retailers and public places to ensure these customers are fully aware of the features and risks of the financial product or service they have bought. This will also help the financial institution to recognize unethical activity, such as mis-sale, misrepresentation, or pressure selling.

Call-backs or surveys are only applicable to financial goods with a time of free-look or cooling off (referred to as the ‘specified period’) and should be carried out before or after the specified time for all transactions closed at stores and public places. This is to allow clients, if they subsequently rethink their decision and decide not to proceed with the transaction, to cancel the transaction within the defined time.

It is to be acknowledged that the call-backs be carried out by a representative’s supervisor who closed the sale as part of the sale’s endorsement by the supervisor. Financial institutions engage a staff who does not make recommendations or effect transactions for customers to conduct the callbacks.

Customers often rely on financial institution representatives to explain to them the features, risks, and fees, and charges of financial products and services to them and to recommend acceptable financial products and services for them. Because buying financial products or services may require customers to have a long-term and/or substantial financial commitment, it is crucial that customers are treated equally and that financial products or services that meet their needs are recommended.

In order to meet sales targets, some representatives may be motivated by the commissions, incentives, and other rewards that are tied to their sales performance and engage in inappropriate practices such as product pushing and misrepresentation. As such, financial institutions should periodically review the marketing, distribution, and advisory activities of their members.

Site visits ensure that marketing and distribution activities are conducted professionally in an ongoing manner while mystery shopping exercises entail more rigorous checks on representatives’ sales and advisory practices, as they can be carried out more regularly. However, in line of site visits, the financial institution can opt to conduct mystery shopping as long as it ensures that frequent and appropriate mystery shopping checks are performed.

Please learn that as financial institutions perform marketing and distribution operations, their members may be dispatched to different locations and simultaneous events may occur. Financial institutions should maintain proper records of their marketing and distribution arrangements in order to exercise effective oversight of their marketing, sales, and advisory activities at retailers and public locations.

Please acknowledge that in the registers maintained by the financial institutions of information on their marketing and distribution arrangements, the financial products and/or services marketed or distributed, the period and duration of the arrangements and/or events and the identities of representatives and supervisors involved, should be recorded. Financial institutions should keep proper records of their marketing and distribution agreements.

Representatives who, on behalf of their financial institutions, market and sell financial products and services should have integrity, adopt ethical practices and uphold the professional image of the financial industry. At present, financial companies have internal standards of professional conduct in place and guidelines that their representatives must comply with when carrying out marketing, sales, and advisory activities.

The financial institutions should conduct call-backs or surveys for all customers prospected at retailers and public places before or within the free-look or cooling-off period to ensure that customers have understood their purchases closed at such locations. This security for the sale of life insurance plans, accident and health policies and mutual investment schemes is anticipated to be adopted by financial institutions.

Where third-party goods or services are sold by financial institutions, they should ensure that their representatives disclose the relationship between the financial institution and the third-party product provider and clarify it to customers. Where there are tie-ups with retailers, financial institutions should ensure the representatives that they clearly disclose to customers the tie-up between the financial institution and the retail consumers and clarify the roles and obligations of each group.

Financial institutions should ensure that the specifics of gifts are not advertised or marketed in such a way that customers ‘ buying decisions are improperly influenced. Financial institutions should ensure that the venue is adequate and conducive for representatives to conduct proper sales and advisory sessions for their marketing and distribution activities.

Adequate controls should be placed in place by financial institutions to ensure that payments collected from customers at retailers are properly handled and securely kept. Financial institutions should ensure that the venue is appropriate and conducive for members to hold a proper sales and advisory meeting for their marketing and distribution activities.

The financial institution should ensure about the space allocated and the environment where their marketing and distribution arrangements are located, that they for suitable for the type and scale of activities involved. For instance, to promote a pleasant and conducive sales and advisory session, the financial institution should ensure that there are sufficient tables and chairs. By ensuring that the venue is not too congested or noisy, disturbances can also be reduced.

Please note that financial institutions should review their policies and procedures in place, and ensure that that they are in line with the safeguards and the outcomes that they are intended to achieve. Furthermore, controls and processes should be placed in place by financial firms to track and ensure that their members adhere to safeguards.

For the sale of banking and general insurance products and services where banking or general insurance product or service purchased is related to the product or service that the customer has bought, financial institutions are not required to implement the safeguard. Financial institutions should conduct regular mystery shopping and site visits to monitor and ensure that the marketing, sales, advisory practices of representatives at retailers and public places are conducted in line with their internal standards and procedures as well as the Guidelines on Standards of Conduct for Marketing and Distribution Activities.