Research On The Legal Regulation Of Commercial Banks’ Personal Financial Management Business In The Perspective Of Investor Protection

In recent years,personal financial management business has continued to develop,becoming a high-growth and high-profit business of commercial banks,and it is also one of the areas where commercial banks are extremely competitive and challenging.The assets management industry,led by the personal wealth management business of commercial banks,is developing rapidly,but there are also chaos such as rigid redemption,maturity mismatch,capital pool operation,etc.,which poses a great threat to the security and stability of financial order and threats investors’ rights.The asset management business has gradually deviated from the track of "trusted by others,managing wealth on behalf of clients".In order to rectify the chaos in asset management and guide the operation of the industry to truly realize“ Caveat Vendor,Caveat Emptor”(which means "sellers are responsible,let buyers be cautious"),the financial regulatory authorities promulgated and implemented the "New Asset Management Regulations" in 2018,and subsequently issued a series of legal documents.An asset management legal system guided by the "New Asset Management Regulations".The asset management business represented by the personal wealth management business of commercial banks has entered a period of "strong supervision and strict risk",and is undergoing steady transformation and innovation on the road of standardized development.However,it cannot be ignored that during this period,commercial banks are also facing new problems in terms of their operating concepts,organizational models,codes of conduct,and rights relief.The protection of investor rights is particularly important.Focusing on investor protection,improving the legal regulation of commercial banks’ personal wealth management business is not only a practical need to realize the standardized and legal development of personal wealth management business,but also an inevitable requirement for promoting inclusive finance and promoting financial innovation.This article takes the personal wealth management business of commercial banks as the research object,takes investor protection as the purpose,focuses on the institutional arrangements and rule design of various new regulations,and combines the practical problems in business development to analyze and discuss the personal wealth management business of commercial banks.Legal attributes,basic concepts,regulatory systems,business and product access,specific rules of “ Caveat Vendor,Caveat Emptor”,dispute resolution and investor education,and other issues,and put forward relevant suggestions on China’s legal regulations.Chapter 2 and Chapter 3 discuss.first explains some basic legal issues,such as the legal attributes and legal framework of commercial banks’ personal wealth management business,and analyzes the status quo and defects of the legal regulation of personal wealth management business of commercial banks in my country as a whole.Secondly,Chapters 4 to 7 specifically analyze related legal regulations from the perspective of "business supervision" and "business operation".The content of "business operation" is discussed from the different links of "prior access,in-process control,and after-event relief".The 6th chapter "in-process control" can better reflect the basic principle of “ Caveat Vendor,Caveat Emptor”,and is also the key content of this article.There are many controversies regarding the legal nature of the personal financial management of commercial banks.Most of them focus on the trust theory and the non-trust theory.The non-trust theory mainly includes the entrusted agent theory,the bank discipline theory,the partnership theory and the mixed theory.This article believes that the legal nature of the personal financial management of commercial banks is "big trust".The "big trust" is specifically manifested in: Firstly,it breaks through the license restrictions of traditional trusts,and secondly,it builds an asset management legal system with the core of “regulating trust relationships.Compared with the legal regulation of deposit and loan business and other asset management business,the legal regulation of personal wealth management business of China’s commercial banks has its particularity.In terms of the choice of legal model,China has adopted the "big trust" legal regulation model,that means on the basis of not deviating from the essence of the "trust",constructing a legal framework that meets the requirements of the development of the asset management industry and the protection of investors’ rights and interests.From the perspective of the main framework of commercial banks,China has established an institutional framework that runs through legislation,law enforcement,and justice under the guidance of supervisory bodies.From the framework of rules,it also lays out and designs the different links of pre-access,in-process control,and post-relief.Realize the "process control" of the overall operation of the industry.Generally speaking,under the framework of the personal financial management legal system of commercial banks in China,great progress has been made in legislation,supervision,and justice,but there are deficiencies.From the framework of legal rules,there are mainly such shortcomings: "investor protection" still needs to be strengthened,“ Caveat Vendor,Caveat Emptor” improperly applied,and regulatory methods "more on administrative penalties,but less in civil remedies."From the perspective of "business supervision",the reform of the financial regulatory system is accompanied by the steady progress of financial innovation.Whether it is functional supervision in the USA or behavioral supervision in the UK,some systems on "investor protection" are essential for the implementation of the "New Asset Management Regulations." They have important reference significance on the improvement of the legal regulations for personal financial management of China’s commercial banks.In order to create a risk-controllable,safe and stable investment environment and effectively protect the interests of investors,China should improve the supervision of commercial banks’ personal wealth management business from the following aspects,such as strengthening risk prevention and control through behavioral supervision,introducing functional supervision,and optimizing supervision Path;establish a regulatory coordination mechanism;refine penetrating regulatory rules,etc.From the "business operation" link in advance access.Different theories of "process cybernetics","goal-oriented theory","economic control theory" and "right norm theory" can provide different perspectives for examining the legal regulations of market access.The most prominent feature of the personal wealth management business access system of China’s commercial banks is the difference between business access and product access under the two organizational forms of “wealth management subsidiaries” and “wealth management divisions.” In the personal financial management business and product access system of China’s commercial banks,there are problems such as risk accumulation and single governance direction.The effect of preventing risks in advance is not as respected,causing hidden dangers to investors’ rights and interests.China should promote the professionalization of access review,improve the organizational system of product access management,and realize the Fintech of access supervision in the process of financial product stress testing and dynamic risk assessment.The in-process control link of "business operation" is a stage where financial disputes frequently occur and are directly related to the interests of investors.It also reflects the basic requirements of “ Caveat Vendor,Caveat Emptor”.The concept of “ Caveat Vendor,Caveat Emptor” has a profound theoretical basis and is refined into relevant rules.The "Caveat Vendor" rules include fiduciary duty,appropriateness duty,and notification duty.In the composition of the "Caveat Emptor" rule,on one hand,the identity of the "buyer" needs to be determined.In theory,there is a dispute between "financial consumers" and "financial investors".Another aspect is the rules of investors’ s rights and obligations.The “ Caveat Vendor,Caveat Emptor” in the personal financial management business of China’s commercial banks have the following shortcomings: Firstly,there is a conceptual misunderstanding between "Caveat Vendor" and "Caveat Emptor",Secondly,"Caveat Vendor" has been abused and the refinement of obligations is insufficient.Thirdly,the identity of the "buyer" under the "Caveat Emptor" rule is vague,and the rules of rights and obligations have defects.In order to improve the“ Caveat Vendor,Caveat Emptor” rule in the personal financial management business of China’s commercial banks,from the perspective of "Caveat Vendor",China should continue to refine and improve the fiduciary obligations,appropriateness obligations and notification obligations of financial institutions.It also reasonably delimits the scope of responsibility of the “seller”based on the “fault” of the investor;from the “Caveat Emptor” rule,the goal of“investor protection” to “buyer’s own responsibility” should be reengineered to increase “financial information” for investors At the same time,it strengthens investor’s obligations,improves the duty of care,and builds an investor’s obligation and liability system.The post-event relief link of "business operation" mainly involves the settlement of financial disputes and investor education.The former emphasizes the "rescue" of investor rights and has an "emergency" attribute,while the latter focuses more on the "relief" of investor rights.It has the characteristics of "normal management".Dispute resolution and investor education are of great significance for safeguarding investor rights and promoting the development of financial legalization.The following problems still exist in the dispute resolution mechanism of personal wealth management services of commercial banks in China: the "independence" of internal remedies of commercial banks is not strong,the "convenience" of judicial remedies is not good,the " applicability rate" of financial arbitration is not high,and the financial mediation is ineffective.The "rule of law" is not enough.China should further improve different dispute resolution methods and establish a dispute resolution mechanism with distinct levels,multiple methods,and progressive levels.Investor education in the personal financial management business of my country’s commercial banks has the problems of insufficient investment and education motivation of educational subjects,and the absence of risk education and legal education.The establishment of an investor education system with multi-party participation and collaboration should be accelerated to improve investors’ Risk awareness and awareness of the rule of law enable investors to strengthen their awareness of self-protection in financial transaction activities,implement the concept of "sellers are responsible,buyers are responsible",and protect their legitimate rights and interests.