FSA cracks down on tweets
The FSA is taking a hard line on financial services firms advertising products on Twitter.
Money Marketing’s sister publication Mortgage Strategy reports the regulator has told a number of brokers and distributors to amend or remove tweets on the social networking website. Money Marketing understands the regulator’s concerns extend to other areas of financial services.
In a financial promotions industry update published in June 2010, the FSA said that its financial promotion rules apply to new media sites such as Facebook and Twitter in the same way as adverts made using any other medium.
It said that because Twitter limits the number of characters that can be used, posts on this site may be an insufficient means of providing balanced and sufficient information.
It is in this area that some brokers are understood to be falling foul of the regulator.
The FSA is also coming down hard on unregulated distributors, telling them they need to make it clear in all promotions, including on Twitter, that they are not authorised to give advice.
Rob Jupp, managing director at Brightstar Financial, says he has been contacted by the regulator over a tweet he posted about a mortgage product his firm is offering from Saffron Building Society.
He says: “The FSA was concerned this tweet could have been overstepping the line into offering advice, but it was clearly written in trade lingo and only aimed at brokers, not consumers.
“The FSA conceded my point and I have no criticism of its decision to contact me, but Twitter is clearly a big issue with the regulator at the moment and advisers need to be aware that they could be overstepping the mark when they discuss products on Twitter.”
A spokesman for the FSA says: “The FSA monitors advertising in all media and we contact firms if we see problems. We know that consumers use adverts to help them shop around for mortgages so we insist that any financial promotions must be clear, fair and not misleading. There are a handful of exceptions but, generally speaking, mortgage adverts need a prominent risk warning.”