Is your website is falling foul of financial promotions rules

Feb 18th '22

Financial promotions or adverts are likely to be the most regular contact consumers have with firms that offer financial services and products. Financial promotions can take the form of a website, Facebook post, tweet, etc. They can form a significant part of a consumer’s product knowledge, and can influence a consumer’s decision making when choosing a product. It’s therefore very important that these promotions are fair, clear and not misleading, so that consumers can make informed decisions.


Compliance consultants will raise the question of financial promotions at initial and ongoing health checks with clients. But when we ask, “do you do any?” we so often receive the same response: “No, we don’t advertise. Most of our business comes through referrals.”


While this is great to hear, as it means you’re keeping clients happy, it quite clearly isn’t true. What firm doesn’t have a website these days?


The Financial Conduct Authority (FCA) defines a financial promotion as, “an invitation or inducement to engage in investment activity or to engage in claims management activity that is communicated in the course of business” and “any advertising or marketing communications”.  This can include correspondence with clients, suitability reports, social media posts, leaflets or adverts in the media, to name but a few.


Crucially, the regulator divides financial promotions into two distinct sub-sectors: real time and non-real time. The former is the easiest to explain.


Many of the FCA rules around firms’ websites are those related to financial promotions. Not every website is a financial promotion but the FCA Handbook states:  “The test for whether the contents of a particular website may or may not involve a financial promotion is no different to any other medium. If a website or part of a website, operated or maintained in the course of business, invites or induces a person to engage in investment activity or to engage in claims management activity, it will be a financial promotion.”


In general, we would expect a typical adviser website to be a financial promotion and so the overarching requirement of financial promotions that they should be clear, fair and not misleading applies, along with several other FCA rules and guidance of which more shortly.


The Competition and Markets Authority (CMA) also imposes a number of legal requirements on what can and cannot be published on a UK website, in particular around the use of online reviews. And the Advertising Standards Authority (ASA) code of rules also have something to say on the matter although many of these rules do not extend to the content of a website itself beyond the clear, fair and not misleading principle.


Primary references

Direct reference to and familiarity with the key aspects of the following rules and guidance will be of value in ensuring your website is compliant … or you can just contact us!


  • COBS 4: Financial Promotions Designated Investment Business
  • COBS 5.2: E-Commerce Designated Investment Business
  • ICOBS 3: Distance marketing – Insurance
  • CONC 3.1: Financial Promotions – Consumer Credit
  • CONC 2.7: Distance marketing – Consumer Credit
  • CONC 2.8: E-Commerce – Consumer Credit
  • MCOB 3: Rules relating to mortgage lending and intermediation
  • PERG 8.22: The Internet
  • DISP 1.1A.11 and DISP 1.2: Requirements to provide information on the FOS
  • FG 15/04: FCA Finalised Guidance – Social Media and Customer Communications


Real time promotions are those that are communicated in the course of a personal visit, telephone calls or other type of interactive dialogue. They are regulated slightly differently to other financial promotions in that the FCA recognises conversations cannot be compliance approved in the same way as published communications.


Since real time financial promotions cannot be pre-approved, it is essential they adhere to the ‘clear, fair and not misleading’ rule.


A non-real time promotion is defined as “a financial promotion which does not involve any simultaneous interactive dialogue”. This includes letters, emails and texts, as well as articles in newspapers, magazines or journals, adverts in other periodical publications, websites and, of course, digital media.


It is websites that are often the biggest cause of concern for us. We see many that contain large amounts of technical information, using industry jargon that, to be fair, even some advisers don’t understand.


Why not have a look at your own website? Consider your target audience. Can they really comprehend or do they need the level of detail you have provided? Many fail the compliance test on the ‘clear’ obligation rule.


Some websites provide information in the form of guides and factsheets. While they are useful to have, they can become out of date very quickly. Is there anything old on your website? Do you have information about taxation that is out of date? Is your material consistent with policy offering documents?


Case studies can be informative but consider how yours are worded. Could they enable a client to take action without seeking appropriate investment advice? If you do decide to add case studies to your website, we recommend adding a disclaimer on each one. It should state that the information is not an offer of investment, shouldn’t be relied upon in making financial decisions and that appropriate guidance should always be sought from a qualified financial adviser.


A word on cookies and social media

The Information Commissioners Office (ICO) makes it clear that consent must be given clearly and accurately if you wish to use cookies, but many websites don’t do this, using words like ‘got it’ instead. It is also a requirement to ensure visitors to your website are informed if you set cookies and what you intend to do with the information.


Meanwhile, we all acknowledge the immediacy of social media is key to successful promotions in this day and age but it can also be a compliance minefield. To ensure posts by your staff or external marketing support adhere to the financial promotion rules, it is vital to have a clear social media policy, so everyone knows what is expected of them.


Don’t forget, forwarding the posts of others also comes under the rules.


Need some promotional advice? If you want to understand more about how to make sure your marketing materials meet FCA standards, please click here.


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