The Financial Conduct Authority (FCA) is continuing its engagement work with social media platforms to stamp out the growing number of unregulated financial promotions being shared online.
Following its work with Google, the regulator revealed it is now in talks with Meta – the parent company of Facebook, Instagram and Whatsapp – to introduce policies that would restrict the type of financial products being advertised on its platform as well as what companies and individuals would be allowed to promote them.
The FCA said it expects “commitments” from Meta “to implement a mandatory solution this year”.
The watchdog is also in talks with YouTube and Twitter to put in place policies similar to the ones adopted by Google a year ago.
The watchdog said that over Q2 2022, “we continue to see a considerable number of cases involving unauthorised firms and individuals” especially those offering claims management services that require a “substantial upfront fee” with the promise of recovering funds for consumers.
Influencers in the spotlight
Another topic that has the FCA on high alert is the rise of bloggers and social media influencers who target younger people to persuade them to invest in products “with promises of high or guaranteed returns but which offer no protection if things should go wrong”.
The regulator added: “We have been clear that the protection of consumers from fraudulent advertising should be strengthened through clear legal obligations in the Online Safety Bill. We welcome the announcements that the government has recently made about the scope of the bill.
“These include imposing a duty on the largest online platforms to protect consumers from fraudulent advertising and designating material relating to fraud offences as ‘priority illegal content’ under the draft bill.”
The much-anticipated Online Safety Bill has been put on hold by the UK government until after a new prime minister is appointed in September.
