The Financial Conduct Authority (FCA) of the U.K. has announced that unpaid social media influencers must comply with financial advertising rules, even if they are not paid directly by the firm. This comes after the FCA gained oversight of crypto promotions with the approval of the Financial Services and Markets Act at the end of June. According to the FCA, if they communicate financial promotions without approval of an authorized person, they are likely to be ‘communicating an illegal financial promotion.’
The FCA also noted that even memes, which are often images with superimposed text, could count as financial promotions. Last year, Jessica and Eve Gale – former contestants on the U.K. reality show Love Island – were told to stop misleading their Instagram followers with pro-crypto posts by the Advertising Standards Authority.
The FCA published its promotion rules for the crypto sector in June, setting out that promoting products using financial incentives like airdrops would be banned and stating that crypto companies needed clear risk warnings with their ads. Registered crypto companies will be allowed to approve their own ads for a limited time once the new financial promotions regime comes into force in October.
In order to ensure compliance with U.K. financial advertising rules, unpaid social media influencers must get appropriate approval. This will help to ensure that their promotions are fair and not misleading.