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    FCA publish financial promotions quarterly data for Q3 2023



    The Financial Conduct Authority (“FCA”) have published important data around its supervisory efforts of financial promotions across quarter 3 of 2023. The data, which provides an overview of the work the FCA undertake to reduce consumer risk and ensure appropriate standards, includes investigations into unregulated activity, breaches of financial promotions rules and supervisory and enforcement actions taken between 1st of July and 30th of September.

    What’s included in the data?

    The FCA reviewed 1,211 financial promotions published by authorised firms and received 5,346 reports about potential unauthorised business. FCA interventions resulted 5,310 promotions being amended or withdrawn by authorised firms.

    Financial promotions are defined under section 21 of the Financial Services & Markets Act 2000 (FSMA) and any communication that promotes a firm’s regulated products, invites or attempts to persuade customers to buy the products a firm market falls under its scope.

    The FCA expect firms issuing financial promotions to take responsibility in making sure all communications of financial promotions are clear, fair and not misleading. This also includes firms that are approving financial promotions and marketing across all media platforms such as websites, paid for Google ads and social media sites.

    Financial promotions which come to the FCA’s attention come from a variety of sources including consumer reports and other regulators. During quarter 3, financial promotions published by authorised firms reviewed by the FCA were sourced from;

    • Proactive monitoring (75%)
    • Consumer reports (11%)
    • UK Regulators (6%)
    • Other areas of the FCA (4%)
    • Regulated firms (4%)

    Retail lending accounted for 41% (which is the highest) of financial promotions amended/withdrawn following regulator intervention outcomes and General insurance and protection firms accounted for 14% (a 3% decrease from the previous quarter).

    Some of the most common breaches involved debt advice firms, credit broker firms and Enterprise Investment Scheme (EIS) providers.

    What must firms do to ensure they do not breach financial promotions rules?

    The FCA set out clear guidance that must be followed for how firms communicate with consumers. This means firms should;

    • pay regard to its target market, including its likely level of financial capability;
    • have in place systems and controls to manage effectively the risks and ensuring good consumer outcomes
    • include the firm’s full name and either address or contact point from which the address is available
    • ensure it is clear, fair and not misleading
    • not omit any matters that cause the promotion to be unclear, unfair or misleading
    • not make false indications regarding the firm’s resources, independence, scale of activities or to the scarcity of service
    • make no references to approvals by the FCA or any government body (unless such an approval has been obtained in writing)
    • take account of what information the customer needs to understand the product or service, its purpose and the risks, and communicate information in a way that is fair, clear and not misleading

    These requirements cover communications published on websites, emails, social media, print, online, television and radio adverts, marketing brochures and literature, direct mail and sales aids, such as presentations.

    It’s important to feel confident about your financial promotions. Our experienced team of Compliance Experts can perform a comprehensive regulatory review of your sales, marketing and financial promotions materials including your website.

    We work with firms to identify any potential non-compliance and recommend improvements to avoid consumer harms and regulatory enforcement.

    Get in touch with us today to discuss your financial promotions services.

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