FCA sends “Dear CEO” letter about financial promotions

Maria Nikolova

The UK regulator has recently become aware of firms issuing financial promotions which suggest that all of the activities which they undertake are regulated when, in fact, they are not.

The latest “Dear CEO” letter by the Financial Conduct Authority (FCA), published earlier today, focuses on the use of financial promotions.

The letter is sent after the FCA has recently become aware of firms issuing financial promotions which suggest or imply that all of the activities which they undertake are regulated by the FCA and/or the PRA when, in fact, they are not. The main purpose of the letter is to remind firms’ senior managers and boards of what constitutes fair, clear and unambiguous financial promotions.

Part of meeting the standard for fair, clear and not misleading promotions includes ensuring that (where relevant) those to whom a financial promotion is addressed understand the extent of the relevant firm’s business that is regulated.

Some of the firms that the FCA regulates undertake both regulated and unregulated business. As some firms issue financial promotions which suggest all of the activities they undertake are regulated by the FCA and/or the PRA when, in fact, they are not, the FCA warns that these financial promotions are unlikely to provide consumers with the necessary clarity. Put otherwise, such ads could leave consumers unable to understand whether the products or services which are promoted are regulated by the FCA and/or the PRA.

The UK regulator reiterates that if a firm names the FCA and/or the PRA as its regulator in a financial promotion that refers to aspects of its business (e.g., products or services) which are not regulated by the FCA and/or the PRA, then the promotion should make clear those aspects which are not regulated.

Firms are also reminded:

  • of the rule in GEN 4.5.4R which states that “a firm must not indicate or imply that it is regulated or otherwise supervised by the FCA in respect of business for which it is not regulated by the FCA”; and
  • that before they approve a financial promotion for communication by an unauthorised person, they must confirm that the promotion complies with the FCA rules on financial promotions. This includes ensuring that the financial promotions which they approve are fair, clear and not misleading.

The FCA notes that it monitors adverts across different media in the UK. Firms are also reminded that the FCA has the power under section 137S of FSMA to direct a firm to withdraw an advert (or its approval of an advert), or to prevent it from being used in the first place.

Read this next

Digital Assets

BlockDAG’s Presale Achieves $9.9M: Aiming For A 5000-Fold ROI As Cardano’s Price Rises And Fantom Launches Sonic

Explore Cardano’s surge, Sonic’s efficiency, and why BlockDAG’s growth makes it the top crypto choice. A deep dive into the future of blockchain investments.

Digital Assets

US, UK probe $20 billion Tether transfers tied to Russian exchange.

U.S. and UK authorities are investigating the movement of $20 billion in the USD-pegged stablecoin tether (USDT) through Moscow-based exchange Garantex.

Digital Assets

BlockDAG Presale Raises $9.9M as Batch 5 Nears Sell-Out Amid Bonk’s Fluctuating Trading Volume & Spell’s Bullish Price

Explore BONK’s trading volume, SPELL’s market shifts, and why BlockDAG’s 10,000 ROI makes it an ideal crypto for savvy investors in 2024.

Digital Assets

Bybit expands into Europe amid regulatory scrutiny

Dubai-based cryptocurrency exchange Bybit is expanding its operations in Europe after encountering regulatory challenges in Hong Kong.

Digital Assets

Cathie Wood’s sponsored Bitcoin ETF sees historic $200 million inflows

The ARK 21Shares Bitcoin ETF (ARKB), co-sponsored by Cathie Wood’s ARK Invest, registered historic inflows exceeding $200 million on Wednesday, signaling a robust appetite among investors for Bitcoin-centric investments.

Digital Assets

Sam Bankman-Fried might see his 25-year sentence halved

Sam Bankman-Fried, the founder of the failed cryptocurrency exchange FTX, was sentenced to 25 years in federal prison by a Manhattan court on Thursday. This comes after he was convicted of defrauding customers and investors, with Judge Lewis Kaplan highlighting the potential future risks posed by Bankman-Fried.

Technical Analysis

EURJPY Technical Analysis Report 28 March, 2024

EURJPY currency pair under the bearish pressure after the pair reversed down from the major resistance level 164.25, which also stopped the sharp weekly uptrend at the end of last year,

Digital Assets

BlockDAG’s Presale Hits $9.9M, MultiversX & MINA Price Predictions Show Green

Read about BlockDAG’s promising $10 prediction and insights on MultiversX Price Prediction as MINA’s potential unfolds.

Digital Assets

Rockstar Co-Founder and All-star Line Up Join Advisory Board to Take Metacade into Post Beta Orbit

Metacade, the revolutionary Web3 gaming platform, prepares to streak out of beta with a slew of ground-breaking initiatives that will redefine the way blockchain games are developed.

<