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FCA publishes consultation on rules for use of social media to promote financial products.

BANKING AND CREDIT NEWS-August 6, 2014-FCA publishes consultation on rules for use of social media to promote financial products


Financial Conduct Authority (FCA), the UK's financial watchdog, announced on Wednesday that it has published consultation paper that sets out a new approach to the supervision of financial promotions in social media.

The FCA intends ensure that financial promotion rules are media-neutral and that consumers are given certain minimum information, in a fair and balanced way.

While not wanting to prevent the use of digital media for pre- and post-sale communication between firms and customers, the regulator stated there should be a fundamental requirement that all communications are compliant with FCA guidance.

FCA requirements for firms to be fair and not misleading should result financial products and services being promoted in a balanced way, so that consumers are made aware of any relevant risks as well as the potential benefits.

Further details of specific areas that firms need to consider are set out in the FCAs consultation paper, which include a specific requirement that financial promotions for investment products are identifiable as such. Each communication should be considered individually and comply with the relevant rules.

The proposed guidance was developed by the FCA following discussions with other regulators in the UK, as well as overseas and other interested stakeholders.

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Publication:M2 Banking & Credit News (BCN)
Date:Aug 6, 2014
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