When it comes to regulations in Europe, transborder legislation like the General Data Protection Regulation (GDPR) and the Markets in Financial Instruments Directive (MiFID) II tend to get most of the attention.
This is hardly surprising, since these regulations are so sweeping and impact so many organizations. But the GDPR and MiFID II are by no means the only regulations that govern financial services in Europe.
In the United Kingdom (UK), one of the key creators of financial regulations is the Financial Conduct Authority (FCA), which much like the Financial Industry Regulatory Authority (FINRA) in the United States, is an independent organization that regulates financial firms and protects the integrity of UK financial markets.
In this blog post, we’ll examine exactly what the FCA expects of organizations when it comes to online content and recordkeeping.
The FCA’s (very long) list of rules and guidance can be found in the organization’s official Handbook, which covers everything from the fundamental obligations of firms to codes of practice, staff training, and recordkeeping.
Unsurprisingly, the FCA Handbook also discusses the use of websites and social media. Not only have legitimate financial firms made increasing use of these channels over the last few years, but scammers are also leveraging the internet to reach unsuspecting investors, which has forced the FCA to explicitly address appropriate use of online content.
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In terms of social media, it has done this in the form of a “Finalised Guidance’ document. The FCA states that any guidance “is not binding and need not be followed to achieve compliance with the relevant rule or requirement. However, if a person acts in accordance with general guidance in circumstances contemplated by that guidance, we will treat that person as having complied with the rule or requirement to which that guidance relates.”
In other words, while the document doesn’t contain any specific rules related to social media, it does offer guidance on how organizations should approach social media use to ensure that they comply with existing FCA rules and standards.
The FCA defines social media as all blogs (such as those typically found on a company’s own website), microblogs (Twitter), social and professional networks (Facebook, LinkedIn), forums, and image and video-sharing platforms (YouTube, Instagram, Pinterest).
Although the guidance is a hefty 20-page document, its overall message can be summed up as: follow the basic rules of communication and promotion, regardless of the channel you’re using.
Digging deeper into the details, the document states that:
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When it comes to website content, the FCA Handbook addresses this in sections such as PERG 8.22 (The Internet) and Website Conditions. As with social media content, much of it once again comes down to following the basic rules of promotion.
Although the FCA’s rules and guidance have been available for quite a few years, many organizations are still at risk of being found non-compliant with regards to FCA regulations. Key to mitigating this risk is the creation of detailed internal website and social media policies that clearly outline acceptable use, as well as the keeping of complete records for all web and social media content to prove compliance.
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