Britain’s financial watchdog set out guidelines earlier this week to stop misleading adverts on social media, and warned “influencers” that promoting a financial product without regulatory approval could be a criminal office.
The Financial Conduct Authority set out how adverts must be fair, clear and not misleading by including risk warnings as social media becomes a central part of marketing strategies.
Influencers or people paid to promote products on social media, need approval for adverts or they risk committing a criminal offence, the FCA said.
“Consumers need to be alert to dubious adverts and scams online, but it is important that influencers ensure they’re on the right side of the rules and consider what would happen to their own reputations if they’re found to promote products illegally,” the Financial Conduct Authority said in a statement.
It also warned financial firms, saying that social media will not always be the best place to promote complex products.
“Firms need to consider whether a platform that offers limited characters or space is the right place to do so,” the FCA said.
Scrutiny of financial promotions has been ramped up and last year the regulator removed over 10,000 misleading adverts, up from around 8,500 in 2022, it added.
