Data published today shows that the Financial Conduct Authority (FCA) intervened to amend or withdraw 4,151 financial promotions between July and September, the highest since it started publishing the data.
Retail lending, investments and banking are the sectors with the highest rate of amends to or withdrawal of adverts and amount to 95% of the FCA’s interventions with authorised firms.
The FCA highlighted that it had seen several cases involving unauthorised firms and individuals seeking to take advantage of the rising cost of living. During the period, the FCA issued 303 warnings about unauthorised firms and individuals, with over 20% being about clone scams.
The data also detailed various actions taken by the watchdog to curb misleading and unfair behaviour by firms as well as tackling scammers. For example, the FCA’s intervention resulted in 66 Buy Now Pay Later (BNPL) promotions from one firm across various social media platforms being amended or withdrawn. It said the adverts did not give fair or prominent risk warnings and were misleading about fees. Although the FCA does not yet regulate BNPL, it warned BNPL firms about misleading promotions earlier this year.
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. With this type of scam becoming more common as the cost of living rises, the FCA relaunched its ScamSmart campaign around loan fee fraud over the summer to help raise awareness among borrowers that might be in vulnerable circumstances.
Mark Steward, Executive Director of Enforcement and Market Oversight at the FCA commented:
“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.”