Regulatory authorities are taking part in the second annual operation, undertaking enforcement actions, regulatory measures, consumer awareness campaigns and educational programmes for financial influencers, or finfluencers.
The FMA’s actions are focused on raising public awareness of the risks involved in engaging with finfluencers, while also reminding finfluencers and the industry of the legal boundaries when promoting or offering financial products or services.
Samantha McGuire, Manager Regulatory Services, says consumers increasingly rely on social media for financial information, exposing them to potentially misleading promotions or fraudulent products and services.
“As financial promotions become more prevalent on social media, international collaboration is crucial in our ongoing efforts to strengthen consumer protection, safeguard individuals from misleading financial promotions and support a fair online environment. This joint action highlights our collective efforts to protect consumers,” she says.
While most finfluencers operate within the law and share information that can help make investing and trading more accessible, the FMA has seen an increase in cases where finfluencers mislead consumers or operate outside regulatory boundaries, creating risk of harm.
The FMA contacted 14 finfluencers active across a range of social media platforms, to outline relevant legal obligations and address concerns about their online content or offerings. As a result, misleading or harmful content has been removed, including advertisements targeting New Zealanders. Some finfluencers have reduced the scope of their services or stopped offering services to New Zealanders altogether.
The FMA has also seen growth in copy trading, where finfluencers encourage followers to replicate their trades, often promoting this as an easy and fast pathway to success. These offerings frequently involve complex, high-risk products. Promotions are supported by luxury lifestyle marketing, showing off expensive cars, designer items and other luxury goods, which can create a false impression of success and downplay the real risks involved.
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