The regulator also called for firms to signpost people to pages containing comprehensive information to avoid misleading them.
Despite its warnings, the FCA said it ‘recognises that social media are powerful channels of communication which are of significant value to firms and do not want to prevent their use’.
Tracey McDermott, FCA director of supervision and authorisations, said: “Financial promotions, whether on social media or traditional media, must give customers the right information and meet our requirements to be fair, clear and not misleading.
“We have had extensive industry feedback during our consultation. We believe this guidance reflects a sensible approach that allows the industry to innovate using new forms of media and at the same time ensures customers get the right level of protection.”
The FCA said that distribution on social media must not mislead even if it ends up in non-intended hands via retweeting on Twitter or sharing on Facebook. The regulator said: ‘One way of managing this risk is the use of software that enables advertisers to target particular groups very precisely’.
The FCA seems pro image advertising, as it said ‘it remains possible to advertise their presence in the market through ‘image advertising’ in a way that is less likely to present difficulties with character limits’.
Firms were warned to treat every piece of communication on its own terms, while the regulator added that communication should be signed off ‘by a person of appropriate competence and security within the organisation’.
The FCA said that both standard risk warning rules and legal requirements still apply when sending out marketing through electronic media.
