FCA UK has created new rules to govern financial services advertised on social media networks. These guides, covering essential formats such as memes, reels, and gameplays, highlight how honesty and integrity are essential aspects of good journalism, making everybody responsible for their activities unbiased and straightforwardly.
The latest statement from FCA reminded all the companies that their brands are held responsible for all the promotional content related to it, irrespective of who is producing that material. Any credit agents involved in selling or promoting a financial product to anyone without FCA Share Certificates before authorization by an FCA-authorized individual could lose their certificate.
As Lucy Castledine, FCA’s Director of Consumer Investments, noted, these rules ensure that financial transactions are carried out safely and soundly. “Promotions aren’t only about the likes! They are about the regulations,” adds Castledine, calling for a more combative approach by the Authority against individuals and platforms that breach financial promotion laws.
Increased FCA oversight and enforcement
Since establishing stricter norms on financial promotions, including high-risk investments, especially based on cryptocurrencies, the FCA has decided to pay extra attention to advertisements that fall short of the country’s financial laws. In the face of the increasing exposure of crypto-related ads, the FCA took the initiative in 2023 to write a rule that actual information about crypto products must be put in any of their online advertisements.
Penalties for Non-Compliance
The regulation applies to crypto businesses whose advertising is aimed at people residing elsewhere but targeting the UK cryptocurrency market, as the UK has been chosen for the business location. Such restrictions and non-compliance are punishable by two years of imprisonment and financial fines.
The Employment and Protection Commission’s recent actions coincide with its general objectives of reestablishing market integrity and protecting consumer safety. As part of its institutional framework, the agency intends to increase its competencies and provide a quick solution to market violations within the crypto sector. Furthermore, it aims to bring international competitive advantage to the UK’s financial sector.
Despite the tough actions by the FCA to ensure compliance with regulation, challenges still exist to thwart, hence the rise in crypto-related advertising defiance. FCA does not take non-compliance lightly; several materials have been issued to correct this through guides and alerts. However, some industry members are still rebelling against the laid rules and regulations.
