The FCA has published its final guidance on financial promotions in social media.
Following a guidance consultation issued in August, the regulator has confirmed that each communication needs to comply with the relevant rules on a standalone basis, and that risk warnings apply to social media in the same way as for any other medium.
In the consultation paper, the FCA said one way of identifying financial promotions on character limited-media such as Twitter is to use the hashtag #ad.
But the regulator says it has now decided that hashtags are not an appropriate way to identify promotional content.
It says this is because when consumers click on a hashtag, they will be led to a separate page where all the communications that have used the hashtag will be displayed.
The FCA says: “These communications and their content will be outside the control of the firm.
“There is potential for consumer confusion as the majority of the information will be irrelevant to the initial communication, although this may not be immediately obvious to the user.”
The regulator says it was asked for further clarification on where the responsibility lies when a communication is retweeted and when this can be considered a financial promotion.
Some respondents to the consultation queried whether ‘favouriting’, ‘commenting’ and ‘liking’ posts can be considered as financial promotions.
It says that a firm retweeting, sharing or liking a consumer’s post could be straying into the financial promotions rules.
It cites a firm retweeting or liking a post from a customer stating ‘just got a brilliant two-year fixed rate mortgage from firm X’ as an example of where the financial promotions rules would apply.
FCA director of supervision and authorisations Tracey McDermott says: “Social media is already an important tool for industry to engage with customers and its use is only set to grow.
“Financial promotions, whether on social media or traditional media, must give customers the right information and meet our requirements to be fair, clear and not misleading.
“We have had extensive industry feedback during our consultation. We believe this guidance reflects a sensible approach that allows the industry to innovate using new forms of media and at the same time ensures customers get the right level of protection.”