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Labour slams FCA over social media guidance

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.”

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Comments

There are 5 comments at the moment, we would love to hear your opinion too.

  1. Mediums tend to either communicate with the dead or forecast the future. The record of the Labour party tends to be very good at the former and as useless as anyone else at the latter. Perhaps we should communicate the problem through the various media.

  2. Derek Bradley ceo Panacea Adviser 18th June 2014 at 10:58 am

    I am not surprised.

    “An FCA spokeswoman says: “Social media is not exempt from the financial promotion requirements”

    They are correct and in the absence of a sensible guide being produced, and to help firms until their guide is produced, we have produced one, released today, that we hope advisers and the FCA will see as being timely, helpful and relevant. Oh, and it is free to download.

    http://www.panaceaadviser.com/main/st9622/Using+Social+Media+Successfully.htm

  3. Ah well. I see it’s back to the same old, same old. Less than 2 years is it for the FCA? They now seem to be indistinguishable from their predecessors. Shame because I for one do believe that they have tried hard to improve.

    I fear that all this ‘slamming’ and negativity will result in them pulling up the drawbridge and we will have missed the opportunity to have a more engaging and perhaps even sympathetic regulator.
    Like everyone one else I guess, I was so much hoping that things would be different this time round.

  4. Would be nice if Cathy Jamieson, actually took them to task about the actual money they have lost for investors through their incompetence rather than the theoretical issues surrounding social media.

  5. I’s like to see the FCA do a Tweet in 140 characters covering this policy & of course the necessary opportunities for readers to have recourse to the FOS and itself.

    It’s comment above is 269 characters without even an address or noting the subject matter.

    Whilst it is at it, perhaps it could do the same for the difference between ‘advice’ and ‘guidance’ and ‘non/un-advised’, ‘simplified advice’ and ‘execution only’.

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