Wenjin Chen | Digital Vision Vectors | Getty Images
Britain’s financial services regulator has announced guidelines for financial services firms and social media influencers creating memes about cryptocurrencies and other investments in a bid to tackle a rise in fraud.
The Financial Conduct Authority said on Tuesday that all marketing of financial products, including those expressed in memes, must be fair, clear and not misleading.
The watchdog said social media influencers, or “financial influencers”, must obtain approval from a representative appointed by the FCA before posting advertisements and memes about financial products and services, the FCA said.
“Promotions are not only about likes, but also about the law. We will take action against those who advertise financial products unlawfully,” Lucy Castledine, the FCA’s director of consumer investments, said in a statement on Tuesday.
“Social media will not always be the best place to promote complex products. Firms need to consider whether a platform that offers a limited number of characters or space is the right place for this.”
The FCA said it has removed more than 10,000 misleading financial services advertisements in 2022.
Advertising cryptomemes
The regulator said the use of memes in promotions is particularly common in the cryptocurrency industry.
Crypto memes are especially common on Telegram, a popular platform among digital currency enthusiasts. Reddit is another place where cryptocurrency is widely discussed.
The FCA said it had seen promotions using memes to promote certain investments in chat rooms such as Reddit and Telegram.
Users of chat rooms and forums should be aware that financial advertising on these channels will continue to be subject to FCA rules.
The move is part of the FCA’s attempt to crack down on the rise of financial fraud. Fraud cases have risen sharply during the Covid-19 pandemic as more consumers have turned to online platforms to meet their banking and investment needs.
The FCA has become particularly aggressive about cryptocurrency advertising. In October 2023, the FCA began requiring firms wishing to promote consumer cryptocurrency investments in the UK to be authorized or registered by the regulator, or to have their marketing approved by an authorized firm.