The FCA and ASA both have their sights on so called “Finifluencers” claiming to be a financial expert. But their numbers continue to grow.
Their rise stems from the seemingly never-ending growth of social media platforms and the time spent online. “Influencers” are now all over the internet, claiming to be a financial expert. They are better known than actors and footballers to some people, especially younger people. They gain popularity for their online posts and grown a fan base. Exactly why is difficult to pinpoint, because their popularity can fall as quickly as it rises. But once popular they have the ability to monetise their position through product promotion. This is now widely accepted, and some are making millions. “Fin influencers” are influencers who promote financial products and services. Often these involve cryptocurrencies. Targeting young people.
Some estimates suggest that over 60% of people say they are guided by online influencers. These are probably not people that you and I are likely to know! Is this a good or a bad thing?
Well, in the regulated financial services environment, the FCA think it’s a bad thing and are trying to actively stamp it out. But some commentators have suggested that it might be better to encourage more regulated and qualified advisers to become the Fin influencers of the future. That way the right messages could be controlled. It seems that there has been some success from professionals acting as influencers elsewhere. Such as doctors or solicitors.
It’s not just online that advisers are missing out. In a recent survey by LiveMore of over 50’s they listed the people they trusted with their finances as follows:
- Martin Lewis! 35%
- Friends and Family 30%
- Online 29%
- Advisers 22%
- Banks 15%
Given that Mr Lewis has no financial qualifications at all and is not a financial expert, we need to make progress with this. It’s estimated that the #investing has had 10 billion worldwide views. That’s a lot of people potentially looking for information and getting the wrong kind.
For example, the FCA has just recover £100,000 from an unauthorised online “adviser”. Mohammed Moricar was using WhatsApp to send messages promoting his unauthorised “24 Hour Trading Academy”. Although he was ordered to pay over £500,000 in compensation.
The latest news centres around hacking of Chat Boxes like ChatCPT. This is the world’s biggest Chat Box with over 100 million users. But it is being heavily targeted by Dark Web hackers according to IFA Magazine. Chat Boxes use Artificial Intelligence (AI) to create “human” interactions with customers online. Users are being warned to be careful, however. Try to avoid providing them with personal information which can be stolen. Upgrade your online security software. Expect more phishing attacks as AI learns to improve spellings and grammar to become more plausible. Remember to always check the address of the website.
Despite that FT Adviser recently ran an article suggesting that ChatCPT AI was already capable of interacting with clients and producing suitability reports and recommendations for financial services!