The FCA intervened on a record 4,151 financial promotions between July and September this year, the highest quarterly number since it started publishing the data.
It forced the providers involved to amend or withdraw their promotions or advertisements.
Investments, banking and retail lending were the sectors with the highest rate of amends or withdrawal of adverts and formed 95% of the FCA’s interventions with authorised firms.
Some 24% of interventions were related to retail investments and 6% to pensions and retirement income.
The FCA said it was concerned about several recent cases involving unauthorised firms and individuals seeking to take advantage of hard-pressed consumers.
Over the quarter, the FCA said it had seen “a number of cases involving unauthorised firms and individuals seeking to take advantage of the rising cost of living.”
The FCA report said: “As consumers become financially squeezed, they are likely to be targeted by fraudsters and scams and also more likely to engage with high-risk and unregulated products such as cryptoassets.
“We are aware that scammers are targeting consumers searching for investments online, in particular through search engines such as Google and social media such as Facebook, Instagram or YouTube. This means consumers often need help to understand which products and services are not necessarily authorised or regulated by us.”
During the period, the regulator issued 303 warnings about unauthorised firms and individuals, with over 20% about clone firm scams.
{loadposition hidden2}
The data, published in the Financial Promotions Data Q3 2022, also revealed action taken by the watchdog to curb misleading and unfair behaviour by firms as well as tackling scammers.
The FCA said some ‘buy now, pay later’ lenders promoting their products on social media did not give fair or prominent risk warnings and were misleading about fees.
The FCA also took action to write to consumers that it found to have been included in a mailing list being used by scammers to carry out ‘loan fee’ or ‘advanced fee’ fraud. It said this type of scam was becoming more common as the cost of living rises.
Mark Steward, executive director of enforcement and market oversight at the FCA, warned that the cost of living crisis was putting pressure on consumers.
He said the FCA wanted to see the Online Safety Bill, currently stalled in Parliament, moved forward as soon as possible as it would cover paid-for financial services online advertising.
He said: “As consumers feel the financial squeeze, they could be tempted by high risk, unregulated products and services or they could become a target for scammers preying on moments of vulnerability.
“As a result, we’re doing even more to tackle false claims in adverts, issue prompt warnings to consumers, and we continue to engage with the largest tech and social media platforms as they also play an important part in protecting consumers from online harm.
“This is why changes to the Online Safety Bill to cover paid-for financial services advertising online are very much needed right now.”
{loadmoduleid 444}
Leave a Reply