"I think the murkier and potentially even more dangerous eco-systems are those such as TikTok and Instagram where unqualified influencers spout nonsense about investments."
In order to show financial services ads of any kind in the UK – including showing ads to UK users who appear to be seeking financial services – advertisers now need to be verified by Google.
As part of the verification process, advertisers must demonstrate that they're authorised by the FCA or qualify for one of the exemptions.
The new Financial Products and Services policy will be enforced from 6th September. Firms can apply for verification at https://support.google.com/google-ads/contact/uk_financial_services_verification.
The change came after the FCA warned that it could take legal action against Google and other online firms if they failed to crack down on advertisements for financial scams.
Prior to Brexit, EU rules on financial adverts did not extend to online platforms such as Google.
The FCA’s head of enforcement, Mark Steward, said: “It’s not immediately apparent whether social media were really aware of what this change actually meant. We’ve made them aware. We now have quite a lot of traction with the social media industry to force change."
Holly Mackay, CEO of Boring Money, commented: “The premise is a logical one – only accept financial product ads from regulated firms. Our data shows 33% of investors and over half (52%) of cash savers cite scams as something they associate with investment risk. This policy offers a sensible measure of control and should mean people can buy with a little more confidence when they search online for an investment provider.
“Stamping out dubious financial ads on search engines is a key challenge, although I think the murkier and potentially even more dangerous eco-systems are those such as TikTok and Instagram where unqualified influencers spout nonsense about investments. That is harder to regulate and control but is where much damage is being done. It’s moving fast and as always I think it’s very hard for the regulator to keep up. Users on these platforms are typically younger and less experienced when it comes to investments and are arguably more vulnerable to loss, since they’re likely to be in a less financially secure position in the first place compared to their older peers.”
