The FCA has issued a press release stating that since 1 April, it has reviewed over 1,500 financial promotions for consumer credit products. In the same period the FCA has opened 227 cases about non-compliant promotions for products such as payday loans, debt management services and credit brokers. A quarter of these cases relate to advertisements for high-cost short-term credit, with many not prominently displaying a risk warning or representative APR.
Examples of financial promotions that did not meet the requirements include:
- advertisements for fee paying debt management firms that did not make it clear that services are not free of charge;
- promotions that guaranteed firms would provide credit regardless of customers’ circumstances;
- a log book lender who provided misleading information about its APR, made unclear comparisons between its rates and those of other lenders, and implied its services were endorsed by the FCA; and
- internet search terms that took consumers to unrelated sponsored links.
View FCA says firms must do more to ensure financial promotions do not mislead, 13 August 2014