The Financial Conduct Authority is interviewing 20 ‘influencers’ under caution as it ramps up its scrutiny of those touting financial services products on social media.
While the FCA was unable to name those targeted for an interview, it came after the regulator targeted a host of Love Island stars earlier this year for running unauthorised financial promotions.
The moves have been part of a wider crackdown by the regulator against influencers. It said it had also issued 38 alerts against social media accounts operated by influencers that may contain unlawful promotions.
It added that those interviewed were asked voluntarily and under caution using the FCA’s criminal powers.
In March, the FCA laid out details on how finfluencers and companies on social media should be appropriately promoting financial products, including the risks of the products they’re promoting, while also not exaggerating their potential gains.
Overall, 74 per cent of 18-29-year-olds who follow social media influencers say they trust their advice, and nine in 10 are encouraged to change their financial behaviour.
“Whilst historically the FCA may have relied upon consumer complaints to identify these accounts, its increasingly assertive and data led approach means it is now much more proactive in trawling a range of different social media to find accounts where it suspects unauthorised activity,” said James Alleyne, legal director in the Financial Services Regulatory team at Kingsley Napley.
“It has the power to get accounts suspended, invite people to an interview under caution or in some cases to arrest.”
“Even where individuals are acting in good faith and creating what is intended to be purely educational content, it does not take much to inadvertently cross the line into regulated business and, by doing so, become exposed to a possible criminal investigation.
“The FCA clearly sees “finfluencers”, particularly those who promote complex and high-risk products, as being a key driver of consumer harm and its focus is only likely to increase on this sector over the coming months and years.”