This article discusses the role of financial influencers, commonly known as finfluencers, who use social media to promote financial products and offer advice to their followers.
The UK’s Financial Conduct Authority (FCA) defines finfluencers as “social media personalities who use their platform to promote financial products and share insights and advice with their followers.”
While many finfluencers operate within legal boundaries, some engage in promoting financial products and services without proper authorization, often showcasing a falsely extravagant lifestyle in their online content.
Recently, the FCA led a global initiative against unlawful finfluencers, supported by regulators from:
– Australia (ASIC)
– Canada (Alberta Securities Commission, Autorité des marchés financiers, British Columbia Securities Commission, Ontario Securities Commission)
– Hong Kong (Securities and Futures Commission)
– Italy (CONSOB)
– United Arab Emirates (Securities and Commodities Authority)
In the UK, the FCA has taken significant action by making three arrests, initiating criminal proceedings against three individuals, interviewing four finfluencers, sending seven cease-and-desist letters, and issuing 50 warning alerts. These alerts have prompted over 650 takedown requests on social media platforms and the removal of more than 50 websites operated by unauthorized finfluencers.
Steve Smart, joint executive director of enforcement and market oversight at the FCA, emphasized, “Our message to finfluencers is loud and clear. They must act responsibly and only promote financial products where they are authorized to do so—or face the consequences.”