The FCA has taken action against a group of individuals, including reality TV stars, for their involvement in promoting an unauthorised trading scheme through social media channels.
According to Finextra Research, among those charged are former Only Way is Essex star Lauren Goodger and others who used their influence on platforms like Instagram to promote high-risk financial products without proper authorization.
Emmanuel Nwanze and Holly Thompson are alleged to have utilized the Instagram account @holly_fxtrends to provide advice on trading high-risk contracts for difference (CFDs) despite lacking the necessary authorisation. They enlisted the help of seven other ‘finfluencers’ to promote the account to a combined audience of 4.5 million followers.
The accused, including Thompson, Goodger, and others from reality TV shows such as Towie, Love Island, and Geordie Shore, face charges related to the unauthorised communication of financial promotions. Nwanze, additionally, faces charges concerning running an unauthorised investment scheme. If convicted, they could face up to two years in prison.
The case underscores the growing influence of social media in financial marketing and the risks associated with improper promotion. The FCA has reiterated that financial services firms are responsible for the promotions they engage in, including those through influencers, and must ensure that such communications adhere to regulatory standards.
In response to the FCA’s actions, industry observers have raised concerns about the need for tighter regulation and oversight of influencer marketing in the financial sector. This case serves as a reminder for companies to vet their marketing partners thoroughly and ensure compliance with regulatory requirements to avoid legal repercussions.
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