FCA Financial Promotions Data 2024: Key Insights
On 7 February, the FCA published its analysis of financial promotions data for 2024, covering key enforcement actions, regulatory trends, and new measures aimed at enhancing consumer protection. The data provides valuable insight into the FCA’s evolving approach in this area and regulatory focus over 2024 and into 2025.
Against this backdrop, FCA interventions in 2024 led to the amendment or withdrawal of 19,766 financial promotions by authorised firms, marking a significant 97.5% increase from 10,008 in 2023. This surge underscores the FCA's increased scrutiny over financial promotions throughout the year. In Q4 2024 alone, 3,697 promotions were amended or withdrawn, with 584 alerts issued concerning unauthorised firms and individuals.
A significant portion of these interventions targeted cryptoasset promotions, following the introduction of the cryptoassets financial promotions regime on 8 October 2023. This is an area which the FCA has consistently identified as high-risk in its potential for consumer harm, maintaining a keen focus on it in recent years. Also worth noting here is the FCA’s guidance on good and poor practices for interpreting the new cryptoasset financial promotion rules.
Section 21 Gateway: New Financial Promotion Approval Process
To strengthen oversight, the FCA introduced the financial promotions approval gateway (effective from 7 February 2024) for authorised firms intending to approve financial promotions on behalf of unauthorised persons. Under this regime, firms must obtain specific ‘approver permission’ from the FCA to approve such promotions. The driver of this is to is to ensure that only firms with the requisite competence and expertise can approve financial promotions, with the aim of enhancing the quality and compliance of promotions disseminated to consumers.
Authorised firms seeking to obtain approver permission must submit a Variation of Permission (VoP) application via the FCA's Connect system. Once granted, firms with approver permission are required to:
Notify the FCA within 7 days each time they approve a financial promotion related to products subject to retail mass-marketing bans or qualifying cryptoasset investments.
Submit biannual reports (REP024) to the FCA within 30 days of the end of each reporting period, detailing approval activities undertaken.
Key Takeaways
The data presented in this publication along with the introduction of the financial promotion approval gateway demonstrates the FCA’s commitment to protecting consumers by ensuring financial promotions are clear, fair, and not misleading, particularly in relation to high-risk products such as crypto asset investments.
Firms who issue financial promotions (or intend to) must be vigilant and mindful of the impact their promotions have. The FCA has shown that it will not hesitate to pursue enforcement actions (including fines and restrictions on business activities) to punish non-compliance. This can include using new digital tools to review websites, with approximately 3,700 sites scanned in 2024 and 1,600 alerts issued to UK consumers on the back of this work. Also worth noting is the targeted action taken against so called ‘finfluencers’ promoting financial products illegally, whereby 20 finfluencers were interviewed under caution and 38 alerts against finfluencer social media accounts published to the FCA’s website.
We encourage firms to review their financial promotion practices to ensure they are adhering to the updated regulatory standards, if applicable. The risks of non-compliance are significant, so taking a proactive approach is essential. If you’d like to chat through, please feel free to get in touch.