The United Kingdom’s Financial Conduct Authority is urging social media platforms to do more to prevent illegal financial promotions.
The agency intervened and forced the withdrawal or amendment of twice as many financial promotions in 2024 as it did the year before, according to a Friday (Feb. 7) press release.
“Over the past year, we have seen a growing number of misleading and illegal financial promotions,” Lucy Castledine, director of consumer investment at the FCA, said in the release. “We have stepped up our efforts in response to make sure that financial promotions are clear, fair and accurate.”
The FCA caused the amendment or withdrawal of 19,766 promotions in 2024, up from 10,008 in 2023, according to financial promotions data released Friday.
The regulator said many of its concerns had to do with promotions around cryptocurrency assets, debt solutions and claims management companies (CMCs). CMCs alone accounted for close to half of the promotions that were withdrawn, and many of their promotions had to do with housing disrepair and motor finance claims targeting vulnerable consumers, the release said.
“We expect firms to take the necessary steps to meet standards and will continue to work with other bodies, including social media platforms, to prevent illegal promotions being pushed at consumers,” Castledine said in the release.
In October, the FCA announced a crackdown on “finfluencers” or social media influencers who promote financial services products — who it said may be participating in unlawful promotions. The regulator interviewed 20 finfluencers under caution and issued alerts against 38 others.
“Finfluencers are trusted by the people who follow them, often young and potentially vulnerable people attracted to the lifestyle they flaunt,” Steve Smart, joint executive director of enforcement and market oversight at the FCA, said at the time in a press release. “Finfluencers need to check the products they promote to ensure they are not breaking the law and putting their followers’ livelihoods and life savings at risk.”
Meanwhile, the FCA said in November that it was seeking comments on its proposal to streamline investor protection rules to lower costs for firms and support the economy.
