UK uses Love Island star to warn fin-influencers about crypto and investment schemes

by · April 6, 2023

UK uses Love Island star to warn fin-influencers about crypto and investment schemes

Britain’s financial and advertising regulators have teamed up to issue a warning to social media “finfluencers” telling them to stop promoting illegal “get-rich-quick” schemes or face law enforcement.

The Financial Conduct Authority (FCA) and Advertising Standards Authority (ACA) referred to cryptocurrencies and non-fungible tokens (NFTs) in their statement on April 6 in their seven-part checklist to ensure fin influencers stay within the bounds of the law.

The checklist asks fin influencers to consider whether they are “the right person” to promote the financial product and says their followers could “lose all the money” from the investment. It also says:

“Don’t suggest to your followers that cryptoassets would be an easy investment decision or create any sense of urgency or FOMO.”

A seven-part checklist aims to give “fin influencers” more clarity about what may constitute illegal financial promotion. Source: FCA

As well as carrying out due diligence, social media influencers should seek approval from the FCA and ensure that the ad is legal, truthful and properly labeled as an ad under the ASA rules.

The FCA and ACA strongly recommend that influencers also check ScamSmart to ensure they are not promoting an investment scam. “If in doubt, don’t promote”, says the checklist’s slogan.

It is a crime to unlawfully promote financial products or services which carries a maximum penalty of two years imprisonment and an unlimited fine:

“If your post breaks the rules, the ASA will take action.”

Sarah Pritchard, the FCA’s Chief Executive explained that there has been an increase in illegal financial campaigns recently.

“They often do this without knowledge of the rules and without understanding the damage they can cause to their followers,” she added.

The FCA and ASA worked with former UK Love Island contestant Sharon Gaffka to highlight the risks involved in lucrative marketing schemes.

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The FCA will also host an “open roundtable” with influencer agents and the Influencer Marketing Trade Body in the coming months.

Related: Celebrities who got burned endorsing crypto and those who got away with it

Across the Channel, France is moving closer to banning French social media influencers from promoting cryptocurrencies and NFTs from unlicensed firms after the National Assembly’s economic committee voted in favor of an amendment on March 23.

If passed, the new law would add cryptoassets to a list of banned financial products that cannot be marketed by influencers, such as gambling and pharmaceuticals.

Those found violating the incoming law could also be subject to two years in prison with a fine of 30,000 euros ($32,300).

Reality TV star Kim Kardashian, boxing legend Floyd Mayweather and internet celebrity Jake Paul are some of the most notable figures who have found themselves involved in allegedly promoting crypto investment schemes.

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