Conflicts of interest
Bank-client conflict of interest: identifying and managing the risks
By Raphaël MORENON8 May 2025The relationship between a bank and its customer is based on the fundamental principles of loyalty and trust. However, the very nature of banking activities, which are multiple and sometimes divergent, can lead to situations where the bank's interests conflict with those of its customer. If these conflicts of interest are not properly identified and managed, they can have damaging consequences for the customer and render the banker liable. It is therefore essential to understand this phenomenon, to recognise its manifestations and to be aware of the existing mechanisms for prevention and recourse. What is a conflict of interest in a banking relationship? A conflict of interest arises when a banking institution finds itself torn between several conflicting obligations or interests, potentially preventing it from acting in its customer's best interests. This situation may arise from the structure of the bank itself or from the different functions it performs. Legal definition...
Conflicts of interest in the banking sector: prevention and management
Conflicts of interest, Banking and securities lawBanking institutions often wear many hats: lender, shareholder, securities distributor, advisor, etc. This inherent versatility creates fertile ground for the emergence of conflicts of interest. High-profile cases such as the Enron scandal in the United States and the LVMH v Morgan Stanley dispute in France are painful reminders of this.Banking ethics rules: specific protection for professionals and local authorities
Conflicts of interest, Banking and securities lawBanking is not just a matter for individuals. Companies and local authorities, major economic players, also benefit from specific protections in their dealings with financial institutions. A set of ethical rules, complementing the legal framework, aims to balance this relationship and guarantee fair practices...Ethical banking rules: protecting private individuals
Conflicts of interest, Banking and securities lawHow do you navigate the jungle of bank charges? What protection is there for vulnerable customers? Under pressure from regulators and consumer associations, the French banking sector has developed a vast body of rules of good conduct. These professional standards, which are often ignored by the general public, nevertheless constitute...Legal value and sanctions of banking ethics rules
Conflicts of interest, Banking and securities lawNavigating the jungle of banking ethics rules is no easy task. Between the codes approved by the Minister for the Economy and simple professional recommendations, it is difficult for a bank customer to find his way around. These rules are part of a wider framework of bankers' responsibilities. Here is an overview...Control and application of banking ethics rules: who supervises the banks?
Conflicts of interest, Banking and securities lawWhen your bank charges what you consider to be excessive fees or refuses to close your account, do you know who regulates these practices? The banking sector is not a lawless area. In addition to the banker's general responsibility, there are specific mechanisms that govern the behaviour of financial institutions, ensuring that...Banking ethics rules: between soft law and legal obligations
Conflicts of interest, Banking and securities lawToday's banks are juggling with different standards. On the one hand, strict laws and regulations. On the other, ethical rules that are sometimes blurred. This grey area between obligation and recommendation is worth exploring to understand how these requirements fit together and what the implications are for customers. Introduction
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