ASIC Commissioner Alan Kirkland emphasized the global nature of this enforcement action, aligning with efforts by international regulators to safeguard consumers from potentially misleading online advice. The regulator insists that influencers must ensure their financial counsel is lawful and demands clarification from those flagged on how they plan to comply with regulatory requirements. Failure to address these concerns may lead to further action from ASIC.
The reach of these finfluencers often extends beyond public posts into private spaces, where direct messaging is used to promote associated investments. ASIC warns that such manoeuvres still fall under the jurisdiction of financial services laws, regardless of their private nature.
The initiative coincides with a Global Week of Action Against Unlawful Finfluencers, with global counterparts such as the UK, UAE, Hong Kong, and Canada also taking measures to address the proliferation of unauthorised financial advice. In recent years, the UK Financial Conduct Authority announced its own response to this trend, removing non-compliant websites and running consumer awareness programs to educate the public about safe online financial interactions.
In Australia, ASIC has a precedent for taking action against rule-breaking finfluencers. Notably, in 2022, the Federal Court found renowned social media personality Tyson Robert Scholz guilty of contravening the Corporations Act, as he conducted financial business operations without a licence. His cases highlighted the significant fines and potential imprisonment penalties for non-compliance, emphasizing the gravity of these regulatory requirements.
More than ever, consumers are advised to be discerning about the sources of their financial advice. With ASIC's professional register available as a tool to verify credentials, the public is urged to distinguish between popularity and credentialed expertise. Commissioner Kirkland underscores the need to ensure that influencers genuinely possess the necessary credentials before consumers act on any financial advice given online.
