The Financial Conduct Authority used a new report this week to describe the degree to which it has focused on illegal cryptoasset promotions targeting UK consumers over the past year.
The regulator reported releasing a total of 2,285 alerts over the past year to prevent consumers from falling victim to scams, with 450 of them in the fourth quarter of 2023 specifically targeting illegal cryptoasset promotions to UK consumers.
The data, released on Wednesday, show that the regulator withdrew or amended over 10,000 financial adverts and other promotions in 2023. That represented a 17% increase compared to the previous year.
Examples of the enforcement intervention that the FCA conducted in 2023 include taking action against a firm offering qualifying cryptoassets that had not identified web pages that constituted financial promotions. The FCA also said it gave feedback to a cryptoasset firm that utilized affiliates for promoting its products with no clear control framework to ensure any promotions made by its affiliates were legal.
FCA’s financial promotions regulations
The FCA’s financial promotion rules for cryptoassets went live on Oct 8, 2023. In the new guidelines, the regulatory authority warned that cryptocurrency memes found to be non-compliant with the new rules could potentially result in criminal offenses.
To ensure that compliance is adhered to, the FCA said firms should issue financial promotions that are clear, fair and not misleading. Companies wishing to promote their financial products must display clear risk warnings and disclose regulated status.
The regulator also expressed concern over the rise of influencers promoting financial products.
“People need clear, fair, and accurate information to base their financial decisions on. We will continue to intervene and take action when we identify firms not meeting our minimum standards,” FCA Director of Consumer Investments Lucy Castledine said.
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