Find out what powers we have to withdraw a misleading financial promotion or advert, and the steps we take to decide whether to act.
We can investigate a promotion or advert if we are told that it is:
- unclear, or
What we can do
If a financial promotion or advert is misleading, we have the legal power to:
- get it withdrawn, or
- prevent it from being used in the first place
This power acts against the promotion or advert, not the firm itself. (It works differently from other powers we have when firms generally don't comply with our rules, or if their overall systems or approach are poor.)
When we act, we consider how a financial promotion or advert could lead to people losing out − either:
- directly (eg, taking out a loan for which the real interest you pay is higher than what is advertised), or
- indirectly (eg, you take out home insurance that was advertised as providing cover against theft, you then get burgled and end up spending money because theft was not actually covered)
The actions we take:
- help us raise standards, eg for new products or relatively new marketing channels like social media
- send a message to any firms thinking of using similar promotions or adverts
We don't need to follow our enforcement process to use this power.
How we decide whether a promotion should be banned
1. We identify which promotions and adverts are misleading and prioritise the most serious cases.
2. We then investigate further. A number of different FCA staff review a promotion or advert before we decide how to proceed.
3. If we decide action is needed, a committee of FCA staff usually decide whether or not to issue a warning (known as a 'first notice'). People on this committee are not involved in establishing the evidence for action to be taken.
4. This notice leads to a firm being legally requested (through what is known as a 'direction') to remove the promotion or advert.
Banning a promotion
1. We inform regulated (also known as 'authorised') firms of the 'direction', stating our reasons for banning the promotion or advert. A direction applies to regulated firms that have approved the promotion or advert on behalf of a non-regulated firm.
2. We allow time for firms to respond and provide evidence that the promotion or advert isn't misleading.
3. We then decide whether we need to amend, withdraw or enforce the direction.
If a firm doesn't agree with our decision, it can refer our decision to the Upper Tribunal.
Publishing our decisions
If a direction is enforced, we'll usually publish the decision on our website with:
- a copy of the promotion or advert
- the reasons behind our decision
We may also put out a press release.
If we have decided to withdraw the direction, we will normally publish this decision on our website.
We will not publish information about the direction if we think this would be:
- unfair to the firm in question, or
- may harm the interests of consumers
On request, we will review published information and decide if it should be taken down (notices or press releases won't usually be removed if they have been published for less than 6 years).