Article by Phil
Crackdown on Financial Planning adverts
The Financial Conduct Authority (FCA) has revealed that it took action on over 20,000 financial promotions in 2024.
That was double the number in 2023. Many of the financial promotions involved crypto currency.
The action taken resulted in the adverts either being amended or withdrawn altogether. According to the FCA they used technology to assess almost 500,000 websites last year to identify whether they were offering Financial Planning advice or services. From this assessment they then reviewed 3,700 websites including social media. These reviews led them to issue 1,600 alerts about unauthorised firms. In addition, they issued 2,200 warnings about potential scams.
This is encouraging news.
They also acted against Claims Management Companies (CMCs) with 9,197 CMC promotions being withdrawn or amended. These were mostly about vehicle finance claims and housing claims.
Advertising Standards Authority actions
Not wanting to be left behind, the Advertising Standards Authority (ASA) also continues to take a proactive approach on financial promotions. Recently it took down social media advertising for a property development scheme offering “six figure returns”, a Luxury Lodge investment scheme promising “guaranteed returns” and a Land Auction investment promising “10% to 30% returns”. All of the adverts failed to properly qualify the risk involved and were guilty of making unsubstantiated claims. So always look out for adverts offering guaranteed returns that appear to be too good to be true.
More action on pension scams.
It’s not just Financial Planning adverts which are being targeted, so are pension scams. The Pensions Regulator (TPR) has announced a new closer working partnership with the City of London Police and the National Crime Agency to tackle pensions scams. The new partnership will see more intelligence on scams being shared between the parties. This has been welcomed by the Pension Scams Action Group (PSAG).
Some success against scammers
The FCA has just managed to secure a Confiscation Order of almost £6 million against jailed investment fraudster Guy Flintham. Although he was judged to have scammed between £19 million and £23 million at least there were some assets recovered. The money will be paid back to victims.
Changes might not help.
The FCA continues to consider changes to their rules to allow “targeted support” for retirees as opposed to financial advice. This would be a cheaper option for people but would only offer guidance about pension options rather than advising clients what to do. This is part of the Advice Boundary Review that has been set up to try and reach the million plus people who retire without speaking to an adviser. But there are real concerns that scammers might see this as an opportunity.
Reviews can help.
One way to reduce scam risks is to check the Financial Conduct Authority website to make sure a firm is authorised. As we’ve reported recently, they have now introduced a simpler register with their new Firm Checker Tool. But you can also check details of online reviews. Try looking at trusted review sites like Vouched For, Trustpilot and of course Google reviews. Although there has recently been an issue with Google removing reviews from Financial Planning firms, worried that they might be fake reviews. Thankfully we haven’t been affected.
We have over 75 fully checked and verified Google reviews, over 400 Vouched For reviews, dozens of Facebook reviews and over 150 reviews in our Testimonials page.
Being confident in who are you dealing with is vitally important when it comes to making investment decisions. Brown Shipley found that 35% of High-Net-Worth Individuals said that their wealth came from investment returns, with only 20% saying they earned their money from property investments. Although property is still more important in London.
