The Financial Conduct Authority (FCA) is currently interviewing 20 ‘finfluencers’, aka financial influencers, as part of its investigation into illegal promotions of financial services products.
This forms part of a broader effort by the FCA to crack down on unlawful activity in the financial advice space, particularly on social media platforms.
Finfluencers dominate online social media, with thousands of accounts garnering billions of views across YouTube, X and even TikTok.
The FCA has expressed concern over the growing influence of finfluencers, particularly among younger individuals.
According to the regulator, nearly two-thirds of 18 to 29-year-olds follow social media influencers, with 74% of those trusting their advice.
Additionally, 90% of young followers have reported changing their financial behaviour based on what they have seen on these platforms.
Steve Smart, joint Executive Director of Enforcement and Market Oversight at the FCA, stated: “Finfluencers are trusted by the people who follow them, often young and potentially vulnerable people attracted to the lifestyle they flaunt.
“Finfluencers need to check the products they promote to ensure they are not breaking the law and putting their followers' livelihoods and life savings at risk.”
The FCA did not name any finfluencers currently under scrutiny but has previously named reality TV personalities Biggs Chris, Lauren Goodger, and Scott Timlin in connection with unauthorised financial promotions.
James Alleyne, Legal Director in the Financial Services Regulatory team at Kingsley Napley, noted that the FCA’s proactive approach is part of a shift towards monitoring social media more closely.
“The FCA clearly sees ‘finfluencers’, particularly those who promote complex and high-risk products, as being a key driver of consumer harm and its focus is only likely to increase on this sector over the coming months and years,” he stated.