The UK's Financial Conduct Authority (FCA) has required firms to amend or remove 8,582 promotions during 2022 - 14 times more than 2021, according to its latest report.
The regulator's financial promotions data 2022, published today (3 February), points to a significant increase in its intervention activity in response to poor financial promotions compliance in authorised firms and activity involving unauthorised firms and individuals.
In relation to authorised firms, the FCA's intervention last year saw an increase of 1398%, compared to 573 promotions amended or withdrawn in 2021.
When it comes to unauthorised firms and individuals, the FCA issued 1,882 alerts in 2022, an increase of 34% from 1,410 in 2021, the data showed. This is despite the regulator seeing an overall decrease of 24% of total reports received in 2022 compared with 2021.
The FCA has worked closely with several ‘big tech' companies to change their advertising policies to only allow financial promotions that have been approved by FCA-authorised firms, it said, but it remains concerned regarding the levels of compliance.
It added that it has made "significant improvements" to the digital tools it uses to find problem firms and misleading adverts, which have enabled it to work through a much larger number of cases compared with 2021.
The regulator is increasingly concerned about ‘fin-fluencers' as unauthorised individuals should not advise people on the merits of certain investments, it said. The FCA has already acted against several social media influencers over the past year.
In one such instance, the FCA found a director of a regulated firm using their personal profile to promote the advice of unauthorised traders and other financial products. The FCA blocked them from using their personal social media to promote financial services and imposed a requirement on the firm to halt any financial services promotions.
FCA executive director, markets Sarah Pritchard said: "Our expectations remain the same. Financial promotions must be fair, clear and not misleading. What has changed is the FCA's approach. By drawing on better technology, we're finding poor quality or misleading ads quicker. And where we find them, we're stepping in to make firms improve them or remove them entirely.
"This year, we will continue to put the pressure on people using social media to illegally promote investments, which put people's hard-earned money at risk."
The FCA is currently consulting on introducing tougher checks for firms which want to approve financial promotions. It also continues to use its ScamSmart campaign to provide people with information on how to avoid investment and pension scams, it said.
