AMF finds issues in SCPI advice

The Financial Markets Authority (AMF) has found that four investment services providers are not adequately informing or advising clients on real estate investment companies (SCPI). The regulator highlights that suitability reports often fail to explain why an SCPI that has become hard to resell or lost value is still considered suitable for an investor.

Review covers specific institutions

The AMF’s review looked at four institutions of varying sizes and profiles between January 2022 and the first half of 2026. However, the regulator clarifies that this group does not represent the entire industry, and no statistical assessment of the whole profession was made.

SCPI risks have changed

The AMF compared current practices to July 2023, when real estate market challenges began to affect certain SCPI. Since then, investors have faced issues like lower share values, longer withdrawal periods, and difficulty in exiting investments, which have increased the risks involved.

Institutions recognized but failed to act

The institutions reviewed generally acknowledged the worsening conditions of SCPIs but did not consistently update their advice. The AMF notes that some non-compliant practices, which existed before the crisis, continued even after the market tensions emerged.

Beyond just performance

The AMF emphasizes that the ability to resell shares and the time needed to recover invested capital are key factors in SCPI investments. An SCPI may continue to generate income even if it has liquidity issues, which must be clearly communicated to investors.

Weaknesses in compliance and documentation

The AMF identified several weaknesses in the operations of the reviewed institutions, including a lack of clear criteria for reviewing SCPIs, poor tracking of client communications, and insufficient measures to prevent excessive concentration of investments in SCPIs.

Some practices show improvement

The AMF also noted more responsible approaches, such as removing underperforming SCPIs from product ranges, training advisors on liquidity risks, and communicating directly with existing investors. Some institutions prioritized investment advice over simply processing orders.

AMF highlights the importance of ongoing advice

The regulator stresses that the quality of advice at the time of investment and the information provided throughout the investment period are crucial. This comes as the market increasingly recognizes that the difficulty of selling shares can be as significant as their changing value.