- The fact that retail investors account for 96% of the queries proves how much they need to rely on this service
- There were recurring queries about commissions charged for delisted securities and about the purchase value of securities acquired a long time ago.
- The volume of queries on the legal status of so called “fly-by-night operations" and stock trading platforms is also on the rise
- The Investor Ombudswoman Office collaborates with Instituto BME in a course organised with the main body of the judiciary and has met with consumer and financial user associations
The BME Ombudswoman Office, which covers the Madrid, Barcelona, Valencia and Bilbao stock exchanges, has today published its respective Annual Reports for the 2021 financial year. With regard to the Madrid stock exchange, last year it received nearly 1,600 telephone calls and more than 500 e-mails, while ordinary mail practically disappeared as a means of dealing with complaints and queries.
On the other hand, there was a significant decrease in the number of complaints and in the degree of conflict in the four exchanges. Ninety-six percent of the queries came from retail investors, one percentage point more than a year ago, while 2% came from market members and financial institutions and another 2% from issuers.
Twenty-seven percent of the information requested focused on stock market information and another 24% on regulatory filings from listed companies. The most common type of query, categorised as "other", accounted for the remaining 49%. This category features questions such as the minimum trading requirement for baskets of securities, the fees generated by delisted securities, the cost of administering warrants, queries relating to securities listed on other markets such as AIAF, MEFF or BME Growth, as well as queries about trading platforms, as a result of retail investors’ increased interest in how to invest.
In 2021, an increase was seen in the number of queries from investors who wanted to confirm that the firms through which they operate were effectively authorised by the Spanish stock market supervisor -CNMV - to provide investment services. On some occasions, these queries came after a previous bad experience with the so-called "chiringuitos financieros" (fly-by-night operations).
There was also an increase in queries on issues over which this Office is not competent, such as foreign securities traded on international markets, foreign currency securities, cryptocurrencies or leveraged products outside the Spanish market, such as CFDs.
Among other issues, investors also queried about warrants, capital increases or the financial situation of a company.
At the Madrid stock exchange, 50% of the complaints or claims were resolved via contentious enquiries, in which the discrepancy is resolved by providing the relevant information, while the remaining 50% related to matters over which the Investor Ombudswoman has no jurisdiction.
The Annual Report also features details of other activities of the Investor Ombudswoman’s Office this year. For example, in collaboration with Instituto BME, the Office participated in a course with the General Council of the Judiciary (CGPJ) to inform judges and magistrates of the existence of this figure and the source of information it can provide for understanding stock market mechanisms involved in certain claims that reach the courts. The Office also held meetings with consumer and financial user associations to share investor concerns and other firms related to investment services.
Among the recommendations contained in the Report, emphasis is placed on delisted securities, especially those that are dormant. In this case, the report recommends Iberclear’s participants that they speed up the activation of the voluntary opt-out procedure, so that retail investors shall not have to bear the cost of maintaining the securities register.
As regards entities, in line with the CNMV, it is considered "good practice for the institution not to pass on custody fees to the client in the event that the deposited securities are delisted and unproductive".
"The Investor Ombudswoman’s Office continues to be an efficient and secure channel for anyone interested in obtaining information and solving doubts about the execution of stock market transactions. We are working to further streamline the handling of these queries by digital means in order to continue to be perceived by investors as an impartial and useful body that they can contact at any time and through any channel", says Gloria Martínez-Picazo, BME Investor Ombudswoman.
You can access the reports on the Madrid, Barcelona, Valencia and Bilbao stock exchanges by clicking on these links.
