Continuing a series of recent actions taken by various financial regulators around the world, Austria’s Finanzmarktaufsicht (FMA) apparently decided to adopt a more gentle approach from some of her colleagues, announcing that she was launching a dialogue with the finals of Austria.
FMA said the Finfluencers – the influences of social media focusing on economic issues – have been ubiquitous on the social media channels. They cover a wide range: from the general economic alphabetism or comments on political and economic issues, through specific recommendations for the purchase of certain financial instruments. Finfluencers often appear as experts, share personal experiences, secular wisdom, market analyzes in a fun and easy understanding of the form.
Their popularity contributes to the further development of the behavior and decisions taken by retail investors, especially the younger ones. On the one hand, the FMA said this approach provides many people information on affordable financial issues, but is also accompanied by specific risks to investors. For example, the dissemination of information that is incorrect, misleading or led by their own interests or frivolous recommendations for complex and dangerous financial products or do not report their interest conflicts, as if Finfluencers are paid by suppliers for their recommendations. And this has not yet been reported – on a coordinated mission a few weeks ago, supervisory authorities from around the world, led by the UK’s economic behavior authority (FCA) have set a stance on some criminals who put in Finfluencers.
Thus, as mentioned above, the Austrian FMA has for the first time invited the Austrian Finlombians in Vienna for the first time to enter into a dialogue with their community. In addition to a round of imports of about 20 registered Finfluencers and FMA experts from integrated supervision and economic innovation and mobile values supervisory departments, the focus was the legal framework applied to new social media channels. One goal is to raise the awareness of Finfluencers about regulations that apply – in particular in the sectors of investment advice and investment recommendations – to prevent them from breaking them inadvertently. FMA said it would also use the influx of this event and other market observations to address the question of whether the current legal base adequately covers the Finfluencers and their influence on retail investors and other market participants.
As mentioned above, FMA’s approach is different from that of some of the other regulators around the world.
ASIC, Australia, recently issued warnings on 18 social media, while the United Kingdom FCA earlier this month made 3 arrests and sent 7 pausing and decoration letters to what a Finfluencer described. Last month, the SCA SCA launched its first Finfluencer license in the area.