The Financial Conduct Authority (“FCA”) has published key data showing its intervention of financial promotions between 1st of April and 30th June 2022.
374 out of 451 financial promotions the FCA reviewed in during Q2 of 2022 resulted in 374 amends/withdrawals of the promotions. Retail investments and retail lending were the sectors with the highest amend/withdraw outcomes, amounting to 83% of interventions. Some of the most common breaches involved credit brokers, mortgage intermediaries and investment platforms.
In 2022 Q2, the FCA issued 286 alerts relating to unauthorised firms and individuals. It was found that 22% of these related to clone scams where a fraudulent firm or individual mimics a genuine authorised business.
The Q2 2022 publication comes only a month after the regulator issued a ‘Dear CEO letter’ warning almost 28,000 lenders and brokers to stop using misleading terms in their advertising or face regulatory action. The FCA undertake proactive monitoring of financial promotions across firms channels such as social media and website material. FCA intervention includes banning of adverts or requiring firms to change, amend or withdraw their marketing material and websites. Proactive monitoring made up 45% of the 451 financial promotions which the FCA reported their data on compared to 24% from consumer concerns.
The data the FCA gather is used to monitor developments in the market, get insights into sectors the regulators have concerns about and act to prevent consumers from harm. It is extremely important that firms carefully consider and document their financial promotions to remove the risk of regulator intervention.