The Financial Conduct Authority (FCA) has set out guidance for firms and financial influencers – ‘finfluencers’ – on ensuring that their ads on social media stay on the right side of the law.
The guidance, covering memes, reels and gaming streams promoting financial services, sets out how adverts across social media channels must be “fair, clear and not misleading”, meaning they must have balance and carry the right risk warnings so people can make well informed financial decisions.
Over the summer, the FCA revealed it was consulting on updating its existing guidance on social media and customer communications to better protect consumers in the era of the ‘finfluencer’ or financial influencer.
The regulator warned that with social media has becoming a central part of firms’ marketing strategies, firms are “on the hook” for all their promotions and need to ensure influencers work with and communicate to their followers in the right way.
Influencers were also reminded that promoting a financial product without the right approval from an FCA-authorised person could be a criminal offence.
It added that while consumers need to be alert to dubious adverts and scams online, it is important that influencers ensure they are on the right side of the rules and consider what would happen to their own reputations if they are found to promote products illegally.
Lucy Castledine, director of consumer investments at the FCA, said: “Any marketing for financial products must be fair, clear and not misleading so consumers can invest, save or borrow with confidence.
“Promotions aren’t just about the likes, they’re about the law. We will take action against those touting financial products illegally.”
