Labour says the Financial Conduct Authority is at risk of falling behind advances in social media because it has taken four years to update its rules on using sites like Twitter or Facebook to market financial services.
In 2010, the regulator issued guidelines for firms looking to use media channels for promotional purposes. They require promotional communications to be easily identifiable, “fair, clear and not misleading”, and include information on compensation.
The same rules apply across all media, regardless of whether it is a blog, an extended Youtube video or a 140 character tweet.
In a response to a written question from shadow Treasury financial secretary Cathy Jamieson, published last week, the Treasury says the FCA has been working with industry on updating the rules and will issue further guidelines later this summer.
Speaking to Money Marketing, Jamieson says: “The social media landscape is constantly evolving and guidance on how these platforms are used to promote financial services should be updated regularly, and certainly more often than every 4 years.
“Mediums such as Twitter and Facebook encourage people to make snap decisions and we must ensure that appropriate safeguards are in place to protect consumers and businesses. Things have moved on considerably since 2010, and any new guidelines must take this into account.”
An FCA spokeswoman says: “Social media is not exempt from the financial promotion requirements. When firms are putting together financial promotions for social media they should consider exactly the same rules as they would for print promotions. We are currently working on updating our social media guidance and will publish it later this year.”