"We want people to stay on the right side of our rules, so we’re updating our guidance to clarify what we expect of firms when marketing financial products online."
The FCA has introduced proposals for new social media guidance that aims to modernise the information firms should use when promoting financial products or services online.
As part of the changes, the FCA is consulting on extending its guidance to reflect the current ways social media is being used to advertise financial services and products.
The regulator has been ramping up its scrutiny of online, often illegal, financial promotions, recognising the significant increase in notoriety of ‘finfluencers’ and the potential for consumer harm taking place online.
The FCA has also teamed up with the Advertising Standards Authority to help educate consumers and influencers about the risks involved in promoting financial products.
FCA engagement has also helped secure changes to the advertising policies of several Big Tech companies to only allow financial promotions that have been approved by FCA-authorised firms.
The consultation follows the announcement of new advertising rules for crypto firms marketing to UK consumers.
From October 8th 2023, the FCA will ban incentives to invest in crypto, such as ‘refer a friend’ bonuses. Firms must also introduce clear risk warnings and a 24-hour cooling period to give first-time investors the time to consider their investment decision. These measures are similar to the regime in place for other high-risk investments.
Lucy Castledine, director of consumer investments at the FCA, said: "We’ve seen a growing number of ads falling short of the guidance we have in place to stop consumer harm.
"We want people to stay on the right side of our rules, so we’re updating our guidance to clarify what we expect of firms when marketing financial products online.
"And for those touting products illegally, we will be taking action against you."
