The regulator again cracks down on misleading financial ads on social media.
This time, however, it focuses on the latest forms of marketing, including memes.
The
Financial Conduct Authority (FCA) has issued new guidance to ensure that
financial promotions on social media platforms are fair, clear, and not
misleading. The regulator scrutinized the latest forms of network marketing,
including memes, reels, and gaming streams.
The move
comes as social media becomes increasingly important in firms'
marketing strategies.
FCA Cracks Down on
Misleading Financial Ads on Social Media
The FCA has
warned both firms and influencers that they must adhere to the rules when
promoting financial products on social media. Influencers promoting a financial product without approval from an FCA-authorized person with the right permission could commit a criminal offense.
As a result, every reel and meme encouraging investment, for example, in cryptocurrencies, will soon be able to be scrutinized for compliance with regulations.
Lucy
Castledine, the Director of Consumer Investments at the FCA, emphasized that
promotions are not just about likes but also about the law. She warned that
the FCA will take action against those touting financial products illegally.
“Any
marketing for financial products must be fair, clear, and not misleading so
consumers can invest, save or borrow with confidence,” Castledine added.
For example, in stories and carousel posts, the risk warning may be easily overlooked if it is significantly smaller than other content or only appears on the last slide. Similarly, in livestreams, if the streamer fails to mention the risk warning while promoting the financial product, viewers may not be adequately informed. In character-limited media, truncating the risk warning to the point where it no longer complies with applicable rules can also be problematic.
Here is one of the examples of what promotional materials look like (left) and how they should look (right), according to the FCA:
The FCA reported that it wanted to control better advertisements on social media and the activities of financial influencers, or influencers, in the middle of last year. The guidelines proposed at that time regarding social media were set to modernize the information companies should use to promote financial products or services online.
Complex Products May Not
Be Suitable for Social Media
The FCA has
also cautioned that social media may not always be the best place to promote
complex financial products. Firms need to consider whether platforms with
limited characters or space are appropriate for such promotions.
The FCA has
increased its scrutiny of financial promotions, removing over 10,000 misleading
adverts last year, up from around 8,500 in 2022. The regulator continues working with the Advertising Standards Authority to educate consumers and influencers about the risks of promoting financial products.
The regulator issued a larger number of consumer alerts about potential scams last year. “For unauthorized firms and individuals, we issued 2,285 alerts in 2023, an increase of 21% from 1,882 in 2022,” the FCA commented. The FCA already published part of this data in February.
The
Financial Conduct Authority (FCA) has issued new guidance to ensure that
financial promotions on social media platforms are fair, clear, and not
misleading. The regulator scrutinized the latest forms of network marketing,
including memes, reels, and gaming streams.
The move
comes as social media becomes increasingly important in firms'
marketing strategies.
FCA Cracks Down on
Misleading Financial Ads on Social Media
The FCA has
warned both firms and influencers that they must adhere to the rules when
promoting financial products on social media. Influencers promoting a financial product without approval from an FCA-authorized person with the right permission could commit a criminal offense.
As a result, every reel and meme encouraging investment, for example, in cryptocurrencies, will soon be able to be scrutinized for compliance with regulations.
Lucy
Castledine, the Director of Consumer Investments at the FCA, emphasized that
promotions are not just about likes but also about the law. She warned that
the FCA will take action against those touting financial products illegally.
“Any
marketing for financial products must be fair, clear, and not misleading so
consumers can invest, save or borrow with confidence,” Castledine added.
For example, in stories and carousel posts, the risk warning may be easily overlooked if it is significantly smaller than other content or only appears on the last slide. Similarly, in livestreams, if the streamer fails to mention the risk warning while promoting the financial product, viewers may not be adequately informed. In character-limited media, truncating the risk warning to the point where it no longer complies with applicable rules can also be problematic.
Here is one of the examples of what promotional materials look like (left) and how they should look (right), according to the FCA:
The FCA reported that it wanted to control better advertisements on social media and the activities of financial influencers, or influencers, in the middle of last year. The guidelines proposed at that time regarding social media were set to modernize the information companies should use to promote financial products or services online.
Complex Products May Not
Be Suitable for Social Media
The FCA has
also cautioned that social media may not always be the best place to promote
complex financial products. Firms need to consider whether platforms with
limited characters or space are appropriate for such promotions.
The FCA has
increased its scrutiny of financial promotions, removing over 10,000 misleading
adverts last year, up from around 8,500 in 2022. The regulator continues working with the Advertising Standards Authority to educate consumers and influencers about the risks of promoting financial products.
The regulator issued a larger number of consumer alerts about potential scams last year. “For unauthorized firms and individuals, we issued 2,285 alerts in 2023, an increase of 21% from 1,882 in 2022,” the FCA commented. The FCA already published part of this data in February.
Damian's adventure with financial markets began at the Cracow University of Economics, where he obtained his MA in finance and accounting. Starting from the retail trader perspective, he collaborated with brokerage houses and financial portals in Poland as an independent editor and content manager. His adventure with Finance Magnates began in 2016, where he is working as a business intelligence analyst.
Saxo's Ownership Change: Sampo Sells 19.8% Stake in the Brokerage
Network, Learn, Grow | FMAS:24
Network, Learn, Grow | FMAS:24
Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
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Get ready to mark your calendars for FMAS:24, returning this May! Take a quick glimpse of what awaits at the Sandton Convention Centre in Sandton, South Africa from May 20-22, 2024.
Don't miss out on this 5-second invite packed with energy and urgency!
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
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Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
🔗 LinkedIn: https://www.linkedin.com/showcase/financemagnates-events/
👍 Facebook: https://www.facebook.com/FinanceMagnatesEvents
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Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Here's a sneak peek into the FMAS:24 vibrant atmosphere! Join us at Africa’s premium financial event for a transformative experience that combines the best of finance and technology.
From May 20-22, 2024, the Sandton Convention Centre in Sandton, South Africa, will be the hub for over 3,500 attendees to engage in unparalleled networking opportunities, learn from over 150 industry-leading speakers, and explore innovations from 120+ exhibitors.
Secure your free ticket now 🔗 https://events.financemagnates.com/yQx0l?utm_source=youtube&utm_campaign=fmas-is-back&utm_medium=video&RefId=FMAS24+Video+Ad+%5B1%5D
#fmas24 #fmas #fmevents #financeinafrica #traders #investors #affiliates #forexTraders #investmentOpportunities #B2BNetworking #finTech #Innovations #TradingCommunity #BusinessOpportunities #AfricanBusiness #Johannesburg #southafrica
📣 Stay updated with the latest in finance and trading!
Follow FMevents across our social media platforms for news, insights, and event updates. Connect with us today:
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Don't miss out on our latest videos, interviews, and event coverage. Subscribe to our YouTube channel for more!
Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 | Africa's Premium Financial Event
Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
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Looking to expand your network in #Africa? Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
📣 Stay updated with the latest in finance and trading!
Follow Finance Magnates for news, insights, and event updates across our social media platforms. Connect with us today:
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Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Join 3500+ Attendees at FMAS:24 - Africa's Premium Financial Event
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Looking to expand your network in #Africa?
Join 3500+ attendees at FMAS:24, where online trading, fintech, payments, and crypto meet! Connect with industry leaders and innovators for an unmatched networking experience.
20-22 MAY 2024
Sandton Convention Center, Sandton, South Africa
Register now to secure your spot: https://bit.ly/3JbUpCK
#fmas #fmas24 #fmevents #networking #finance #africa
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Where the Prop Trading Industry Goes from Here | Finance Magnates Podcast
Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
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Explore the tumultuous world of prop trading in this Finance Magnates podcast episode, featuring insights from Head of Axi Select, Greg Rubin.
We're discussing the challenges and shifts caused by MetaQuotes' pivotal decisions affecting MT4 and MT5 users, and how Axi Select offers a unique, realistic path to professional trading, steering clear of traditional prop firm pitfalls.
Tune in for expert analysis on the future of trading and innovative funding models.
The Axi Select programme is only available to clients of AxiTrader Limited. CFDs carry a high risk of investment loss. In our dealings with you, we will act as a principal counterparty to all of your positions. This content is not available for AU, NZ, EU and UK residents. For more information, refer to our Terms of Service. Standard trading fees apply.
This content is provided solely for general informational purposes and should not be construed as financial product advice or an investment recommendation. It has been prepared without considering your personal circumstances.
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