Seven influencers fined for unauthorised financial promotions
Seven social media influencers have been sentenced and fined at Southwark Crown Court for promoting an unauthorised foreign exchange trading scheme. The Financial Conduct Authority brought the case against the individuals.
Penalties for illegal promotions
Seven social media influencers, including Lauren Goodger and Biggs Chris, pleaded guilty at Southwark Crown Court to issuing unauthorised financial promotions related to a foreign exchange trading scheme.
The penalties varied, with Lauren Goodger receiving the highest fine of £3,750 and costs of £5,778.18. Biggs Chris was fined £600 plus £1,000 in costs, while Jamie Clayton received an £820 fine and £1,000 in costs.
Rebecca Gormley was given a conditional discharge, paying £2,866.42 in costs.
Yazmin Oukhellou was fined £974, Scott Timlin £938, and Eva Zapico received an absolute discharge.
The combined Instagram following of these individuals reached 4.5 million, underscoring the broad reach of the unauthorised promotions.
This enforcement action highlights the Financial Conduct Authority's commitment to tackling illegal financial promotions on social media platforms, especially those targeting a wide audience through influential figures.
Protecting followers from risk
Steve Smart, executive director of enforcement and market oversight at the FCA, stated that 'These influencers betrayed the trust of those who followed them.'
He affirmed the FCA's resolve to collaborate with responsible influencers while pursuing those who endanger their followers' financial well-being.
The unauthorised promotions involved Contracts For Difference (CFDs), which are high-risk derivatives.
The FCA has previously highlighted that approximately 80 percent of customers lose money when investing in CFDs due to their leveraged nature, which can lead to losses exceeding the initial investment.
In the UK, the FCA has implemented restrictions on the marketing and sale of CFDs to retail customers to mitigate consumer harm.
Communicating unauthorised financial promotions is an offence under Sections 21 and 25 of the Financial Services and Markets Act 2000.
Influencer marketing under scrutiny
This enforcement action sends a strong message to social media influencers regarding their responsibilities when promoting financial products.
The significant reach of these individuals underscores the urgent need for robust regulatory oversight in the digital space.
While the fines are relatively modest, the reputational damage and legal precedent set are substantial for both influencers and the broader financial promotions landscape.