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The UK regulator is targeting bloggers to crack down on illegal advertising

Britain’s financial regulator has urged tech giants to do more “to protect consumers” after a surge in misleading product promotions by social media influencers and bloggers led them to issue a record number of dismantling orders.

The Financial Conduct Authority said on Friday it had asked businesses to change or remove 8,252 promotions in 2022 – 14 times more than the year before – and issued over 1,800 warnings to prevent consumers from losing money to fraud .

Only FCA authorized groups are allowed to offer financial promotions in the UK.

Noting an increase in bloggers and influencers on sites like Instagram, Facebook and YouTube promoting investment products to younger people, the watchdog said “tech companies need to do more to protect consumers.”

The UK regulator is targeting bloggers to crack down on illegal advertising, Crypto Trading News

The warning comes amid growing concerns that rising costs of living are pushing more people into risky financial products, and follows a pledge by ministers to overhaul regulation of the cryptocurrency sector.

The watchdog warned that unauthorized “influencers” – influencers who post content related to financial matters – also need to think carefully before promoting products and be clear about their responsibilities when using their social media channels advertise to avoid breaking the law.

“In the most serious cases, we have and will refer fin influencers to criminal investigations,” she said, adding that she was concerned about a trend among bloggers to encourage loans, particularly to students, on behalf of unauthorized third parties.

The FCA does not have the power to enforce the removal of websites. Instead, it must ask the platform hosting malicious content to remove it.

It said Friday that given the high number of illegal financial actions, it expects all social media platforms to improve their ability to proactively identify and take them down.

In one case, the regulator found that a director of an authorized company had used a personal social media profile to advertise advice on unauthorized dealers and other financial products.

Sarah Pritchard, FCA Chief Executive for Markets, said: “This year we will continue to put pressure on people using social media to encourage illegal investments that are putting people’s hard-earned money at risk.”

The FCA said it was concerned the cost of living crisis would leave more people vulnerable to risky products. In one case, it forced an online retail broker with more than 1.1 million customers, mostly in their mid-20s to late 30s, to shut down a marketing campaign.

“We had serious concerns that the company’s financial promotions, involving social media influencers, were targeting vulnerable consumers with significant debt,” the regulator said.

cryptocurrency was also a focus for the watchdog. It said it requested the removal of the website of an unregistered exchange provider that appeared to offer consumers digital asset derivative products.

Providers of digital asset services are currently required to pass anti-money laundering checks, and the FCA is considering introducing stricter measures for companies offering financial promotions.

The proposed controls are said to make removal more harmful Advertising accelerated by unregulated groups and individuals.

The UK government this week unveiled plans to align the regulation of the cryptocurrency industry with that of mainstream financial services.

While the FCA does not regulate crypto, it is said to be given oversight of most of the sector’s marketing.

Source: Crypto News Deutsch

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