Switzerland'sfinancial regulator says the number of problem cases involving independentportfolio managers doubled last year, with retirement savings among the moneyput at risk.In guidancepublished today (Wednesday), the Swiss Financial Market Supervisory Authority,known as FINMA, said it keeps finding the same issues turning up in clientportfolios, namely conflicts of interest, thin suitability checks and complexproducts that many clients were never well suited to hold.Escalation Cases Doubledto 68 Last YearFINMAopened 68 supervisory cases tied to portfolio managers in 2025, up from 34 ayear earlier and just nine in 2023. The firmsinvolved fall under Article 17 of the Financial Institutions Act, the regimethat brought Switzerland's independentasset managers under direct licensing after a transition period closed at the end of2022.Half oflast year's cases came from the supervisory organizations that monitor thesector day to day, the rest from third-party reports. About 1,664 managers andtrustees held licenses by the end of 2025.The losseswere not small. FINMA said client assets at risk ran from tens of millions toseveral hundred million Swiss francs, with some of the money "required forretirement provision."EU Regulators Are Chasingthe Same ConflictsFINMA isnot the only watchdog worried about whether firms put their own interests aheadof clients. In March,Cyprus's CySEC told investment firms it would run on-site inspections intoconflicts of interestas part of a European Securities and Markets Authority sweep, looking at staffpay, platform design and inducements across the bloc.ESMA raiseda related point in February, when it reminded firms that perpetualfutures fall under EU rules for contracts for difference. It calledsame-group product issuance a notable conflict that can nudge firms towardtheir own products, the same dynamic FINMA describes with in-house funds andcertificates.Thedifference is who FINMA is aiming at. Its guidance does not target retail CFDbrokers but the discretionary managers who build portfolios for wealthierclients, often using foreign funds, actively managed certificates and in-housestructures that carry lighter supervision. The concernunderneath, selling complex products to people whose risk profiles do not fitthem, is the one regulators across Europe have spent 2026 pressing.In-House Products andStacked Fees Draw the Closest LookTheclearest pattern, FINMA said, involved products the managers themselves issueor structure. Theregulator found opaque, stacked fees, pay incentives that rewarded staff forsteering clients into the firm's own products, and portfolios concentrated"in clear contradiction to clients' risk profiles."Theproducts in question included foreign funds without equivalent oversight, structured products such as activelymanaged certificates,and securities from unregulated issuers abroad. Many carrylighter transparency, valuation and liquidity requirements, FINMA said, andsome lack audited accounts entirely.Theregulator also pointed to suitability failures, with some firms putting clientsinto high-risk or illiquid instruments without checking properly whether theproducts matched their finances, goals and appetite for risk.A Young Supervisory RegimeUnder StrainThe caseload is testing a system that is still bedding in. Ongoing supervision ishandled by private supervisory organizations, with FINMA stepping in only for serious breaches, and theregulator said it found weaknesses in how those bodies authorize and overseethe audit firms they rely on.Smallerfirms also lean on outside providers for risk management and compliance, FINMAsaid, which in several cases produced standardized rather than tailoredcontrols and left responsibilities unclear. It followsan April guidance in which FINMAreported that 42% of surveyed Swiss financial firms had no policy for digitalfraud.Supervisorycosts dipped slightly in 2025, though FINMA said its workload in the area staysheavy. The guidance carries no enforcement actionagainst any named firm and instead restates the rules on suitability,governance and conflicts that managers are already meant to follow.This article was written by Damian Chmiel at www.financemagnates.com.