The Financial Conduct Authority (FCA), an autonomous regulator overseeing finance in the UK, has released a report outlining its efforts concerning financial promotions. This includes its investigations and responses to advertisements linked to cryptocurrency.
Thank you for reading this post, don't forget to subscribe!On Wednesday, the FCA announced that it discovered considerable instances of non-compliance with the rules governing cryptocurrency promotions, which were implemented on October 8, 2023. The regulator conducted reviews of both registered and unregistered crypto companies and identified recurring issues.
This involves the use of general risk overviews without modifications for risks specific to particular products like stablecoins or asset-backed coins, as well as leveraging regulated status as a promotional tactic. Additionally, the FCA noted that companies are asserting the safety, security, and user-friendliness of crypto services without substantiating evidence or adequately highlighting associated risks.
The regulatory body cautioned companies that it would address repeated violations of the regulations and might resort to enforcement measures if needed. It emphasized that from October 8 to December 31, 2023, it issued 450 consumer alerts against digital asset firms unlawfully promoting cryptocurrency.
“We are working with tech companies to remove and block illegal promotions, including websites, mobile applications (apps) and social media accounts. For example, our work has resulted in 35 apps being removed from app stores at the end of December 2023,” said the regulator.
The FCA further cautioned cryptocurrency firms that it intends to persist in its efforts to combat illegal promotions throughout 2024. It expressed apprehensions regarding regulated entities failing to fulfill their obligations when offering support services to crypto companies unlawfully promoting products to consumers in the UK.
In addition, the regulatory authority disclosed that it instructed the removal or modification of more than 10,000 finance-related advertisements in the UK last year.
The FCA revealed that in 2023, it received upwards of 24,000 notifications regarding potentially unauthorized enterprises. The organization noted that these reports were elevated when substantial evidence of misconduct was present, and it encouraged consumers to persist in reporting deceptive advertisements and potential fraudulent schemes through its designated channels.
