Global: French regulator urges crowdfunding platforms to strengthen investor protection

France’s financial markets regulator, the Autorité des Marchés Financiers (AMF), has called on crowdfunding platforms to strengthen their compliance practices and investor protection measures following a series of spot inspections conducted over the past year.

The inspections assessed how platforms comply with regulatory requirements designed to help investors understand the risks associated with crowdfunding, including knowledge tests, client information and other safeguards.

AMF identifies weaknesses in crowdfunding compliance

The supervisory exercise focused on several areas, including entry knowledge tests designed to assess investors’ expertise and suitability, client information sheets, complaints handling and internal controls.

Crowdfunding has been subject to an EU-wide regulatory framework since 2021, when the bloc introduced common rules for crowdfunding service providers and gave member states a two-year implementation period. Since then, the AMF has monitored newly authorised market participants and included crowdfunding among its supervisory priorities in 2025.

The regulator’s latest inspections found weaknesses in some platforms’ implementation of the framework, particularly around investor knowledge assessments and information provided to clients.

Investor knowledge tests require stronger controls

According to a summary of the AMF’s inspections, some service providers had poorly formulated or incomplete questions in their investor knowledge questionnaires, while questions required under the regulatory framework were missing entirely in some cases.

The findings raise concerns about whether investors are being adequately assessed before accessing crowdfunding investment opportunities.

Knowledge tests are intended to help platforms establish whether prospective investors understand the nature and risks of the products they are considering. Effective compliance therefore requires platforms to ensure that the assessments are complete, clearly worded and aligned with regulatory requirements.

AMF flags gaps in risk disclosures

The regulator also identified shortcomings in client information documents, particularly regarding warnings about potential investment losses.

In some cases, information sheets did not make it sufficiently clear that investors could lose their entire invested capital. Such disclosures are particularly important for retail investors, who may not fully understand the risks associated with crowdfunding investments.

The AMF said these information and assessment mechanisms are essential to helping retail investors make informed decisions.

“All of these systems are crucial for retail investors to be able to make informed investment decisions,” the AMF stated.

Regulator calls for stronger investor safeguards

The AMF encouraged crowdfunding service providers to strengthen their practices and improve their compliance frameworks across the areas covered by the inspections.

The regulator also stressed the importance of appropriate complaints-handling systems that are accessible and free for complainants.

It further called on platforms to provide clear, honest and traceable information throughout the investment process, reinforcing the need for effective internal controls and transparent communication.

The findings highlight the importance of regulatory monitoring as crowdfunding markets mature under the EU framework, with platforms expected to maintain robust investor-protection systems and demonstrate effective compliance with applicable requirements.