The Financial Conduct Authority (FCA) has confirmed to International Adviser it has been engaging with Google over concerns regarding the promotion of unregulated products on its search engine.
Following the FCA’s ban on the promotion of speculative mini-bonds in November 2019, which will come into force in January 2020, there has been a lot of speculation regarding the advertising of such products on the tech giant’s website.
On Twitter, people have shared pictures showing paid adverts coming up as the first two search results from Google, which were marketing bonds similar to the ones promoted by now defunct London Capital & Finance.
One website, called ‘simplybonds.co.uk’ claimed its products to be 100% protected by the Financial Services Compensation Scheme (FSCS), while the second one, named ‘dailyinvestor.co.uk’ advertised “12% fixed return in 12 months”.
The paid ads came up on Google during a search made on 6 December 2019.
Great but what have you done? As of now Google is still published the https://t.co/K5fmaOn3UT advert – see screen grab below. Why can't these scams be taken down? Am I wasting my time trying to help you? https://t.co/fHKrge8OQs pic.twitter.com/dUFZ4RjdX0
— Mark Taber 🇺🇦 (@MarkTaber_FII) December 6, 2019
Cooperation
Andrew Bailey, chief executive of the FCA, told IA: “We have had some constructive discussions with Google, which indicate they are looking for ways to help protect customers from exposure to harmful firms.
“We want to build on this so that Google does more to ensure unauthorised firms and fraudsters are banned from paid advertising.
“For example, Google could check whether a firm is authorised by us before it allows them to pay to promote their adverts.
“We would also like to make the process of flagging bad adverts easier so Google can take them down more quickly.”
The tech giant was also approached by IA and it confirmed it was holding conversations with the UK regulator and that the specific ads mentioned on Twitter have been taken down.
Harsher on unregulated promotions
The FCA added it was not only the advertising of mini-bonds it hoped to tackle with Google, but the whole plethora of unregulated and fraudulent products that are still allowed to be advertised on the firm’s search engine.
“Firms are breaking the law by putting financial promotion for unregulated products, such as mini-bonds, in adverts without appropriate authorisation that they are clear, fair and not misleading by an authorised firm or without a valid exclusion,” the regulator said.
“Searches on Google and referrals from the public regularly uncover large numbers of such adverts. It is time-consuming and challenging for the FCA to find these adverts and get them taken down; it would be a lot better if they never appeared because Google refused to accept them in the first place.”
Future developments
The watchdog told IA it hoped its engagement with Google would see the US firm take “concrete steps to address this”, because at the time being it was “tedious” to do due diligence on every single advert.
Currently, when there are issues with fraudulent or unregulated adverts, the FCA has to submit a form flagging this up, but this doesn’t always result in them being taken down.
“We would like to see a more formal or direct arrangement where we can flag bad ads to Google and get them taken down more quickly,” the FCA added.
“In the longer term, we would like to provide Google with an Application Programming Interface (API) for the FCA Register, so it can quickly and accurately check whether a firm is authorised before it profits from their business.”
