5th Feb

FCA Admits it Can't Prevent Search Giants Advertising Investment Scams

Despite its ban on the advertising of high-risk mini-bonds following the London Capital & Finance Scandal, the Financial Conduct Authority (FCA) has said it is powerless to stop advertisements for investment scams appearing on the internet and wants the government to intervene.

Products that could be identified as scams are often advertised as 'high-yielding investments' via internet search engines such as Google and others.

Andrew Bailey, outgoing chief executive of the FCA, said he would like internet search providers to take down scam adverts within 48 hours of being alerted to them.

However, an FCA representative told FTAdviser: 'The FCA has no power to direct Google to stop advertising online scams and frauds nor does any other agency. This is why we strongly believe this should be covered in the Online Harms Bill.'

The regulator said that adverts for investments that might be scams often appear when individuals use search terms such as 'high investment returns'.

Included in the government’s Queen’s Speech in December, the Online Harms Bill is a joint initiative from the department of Digital, Culture, Media and Sport, and the Home Office.

The bill is intended to ;protect children and vulnerable adults from digital threats'; an independent regulator will be appointed to monitor online companies' behaviour.

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