Ask a group of finance professionals the following question:
What is the FCA’s rules on using social media for financial marketing?
And you’re likely to see lots of blank looks and shrugged shoulders. (I should know, I ask this question regularly.)
Not surprising, as the FCA’s views on social media marketing are numerous and complicated.
The result is that many firms simply avoid a strong and varied approach to social media, as they fear the prospect of a hefty fine if they are found to have breached FCA rules.
But I’m here to help you. In a series of LinkedIn posts I’ll reveal what you need to know to stay on the right side of the regulator.
I’ll start by giving you a general introduction to the FCA’s social media policy. Firstly, this is largely what the FCA defines as social media:
- Microblogs (eg Twitter)
- Social and professional networks (Facebook, LinkedIn, Google+ etc)
- Image and video-sharing platforms (YouTube, Instagram, Pinterest etc)
The fact that forums and blogs are included here is worth noting, as most people would not see these as social media. So, as far as FCA-compliance is concerned, it’s best to classify any form of online communication as social media. This is with the exception of email, which has its own rules.
Another thing to recognise is that the FCA is not against the use of social media. In fact, it encourages it, stating that:
‘We recognise that social media are particularly powerful channels of communication and therefore of significant value to firms. We do not want to prevent their use.’
What the FCA seeks to regulate is any social media message that constitutes a financial promotion.
And how do you know if your message constitutes a financial promotion?
Good question. Look out for my next post to find out the answer.
- The FCA supports the use of social media, but has regulations that govern its use
- The FCA classifies all online communication – including blogs and forums but excluding email, which has separate rules – as social media
- Any social media communication classified as a financial promotion must adhere to FCA regulations