Every Investment Promotion Needs an Authorised Firm Behind It
Under section 21 of the Financial Services and Markets Act 2000, a person may not, in the course of business, invite or encourage someone to invest unless they are authorised by the FCA or the promotion has been approved by an authorised firm. A breach is a criminal offence, punishable by up to two years in prison, an unlimited fine, or both.
The rule applies on social media exactly as it does in print. The FCA's guidance on social media promotions, FG24/1, confirms that an influencer's posts about a regulated investment can be a financial promotion even when the influencer has no commercial arrangement with the firm.
A Large Following Is Not an Authorisation
An audience of thousands, polished videos and screenshots of profits say nothing about whether the person is permitted to promote an investment. The FCA has brought criminal charges against influencers who promoted trading schemes to their followers without approval.
A paid advert offers no more assurance. A sponsored post shows that someone paid the platform to display the advert, and tells you nothing about who will hold your money.
Ask Who Approved the Promotion
Ask the person promoting the investment two questions: which firm is offering the product, and which FCA-authorised firm approved the promotion. A lawful promotion can answer both, and both firms can be found on the FCA Register.
Then look up the offering firm yourself. Confirm that its status is authorised, that its permissions cover the product, and that the website and telephone number you were given are the ones the Register lists.
Private Messages and Groups Follow the Same Rule
Many approaches move from a public post to a private message or to a group on WhatsApp or Telegram. What is said there is still a financial promotion, and the same two questions apply.
Treat with caution any request to pay in cryptocurrency, to a personal account, or to a company whose name differs from the firm being promoted.
Confirm Where the Money Goes
Before transferring money, use your bank's Confirmation of Payee check to confirm that the receiving account is held in the exact name of the authorised firm. A payment to an individual, to an unrelated company or in cryptocurrency should stop the transaction.
Report a promotion you believe is unapproved to the FCA on 0800 111 6768. Most social media platforms also let you report a post or an account directly.
How MetaAshes Examines This
A MetaAshes assessment cross-references a firm's details against the official record in a single pass. For this question, the most relevant checks include:
- Authorisation status
- Scope of regulatory permissions
- Crypto promotion approval
- Loan note promotion approval
- Official website on record
- Method of first contact
- Payment method
- Payee name verification
- Promised returns
Frequently Asked
Is it illegal for an influencer to promote an investment?
An influencer may lawfully promote an investment only if they are authorised by the FCA or an authorised firm has approved the promotion. Promoting a regulated investment without either may be a criminal offence under section 21 of the Financial Services and Markets Act 2000.
How do I check who approved a promotion?
Ask the promoter to name the approving firm, then search the FCA Register for that firm and confirm that its status is authorised.
Can MetaAshes check an investment I saw on social media?
Yes. An assessment reads the FCA Register and Warning List, the firm's company record, the age of its website and the payment details you were given, and reports where they do not agree.
This guide is provided for general information and does not constitute financial or legal advice.