With the irruption of social networks, all kinds of influencers have emerged. Those who advise on what clothes to wear or show cooking recipes. But talking about any topic, with the great exposure that the internet brings, also comes with a responsibility. Also in the complex world of finance. For this reason, the European Commission proposed yesterday that the activity of people who are professionally dedicated to promoting financial products on digital platforms be regulated. It also requires that, ultimately, the companies that hire these users be responsible in the event that the rules are breached.
The work of those known as financial influencers can have a great impact on citizens. They are people who accumulate thousands of followers on platforms such as Tik Tok or Instagram, where they talk about concepts that not everyone has a deep knowledge of, and recommend investment products, sometimes high risk, such as cryptocurrencies.
For this reason, Brussels proposes that these users provide clear information that is not misleading, while also being informed of the risks and benefits of the product they promote. "It should not seem like clothing and footwear marketing, the risks should be clearly identified," community sources explain.
The objective of the European Commission is not to put an end to this type of influencers, but to bring order to so much information that can be confusing. But Brussels also contemplates what happens if its announcements are not clear. In this case, the companies that sometimes hire these influencers to promote their products will be ultimately responsible for their actions. Thus, if the information, for example, is misleading, the companies could face fines or even the withdrawal of the license in case of recurring violations. The decision will be made by the national authorities, also on what should be the amount of possible fines.
The companies that hire the influencers will have to verify the ads and ensure that they comply with the European rules. In addition, they will be obliged to keep all the promoted information so that the authorities can study it in the event of a complaint. With this measure, Brussels also aspires to encourage investment by giving more tools and protection to consumers. In this way, we want to avoid cases like the one at the end of last year, when after the collapse of several cryptocurrency companies, some consumers warned that they had invested on the recommendation of financial influencers.