Lawmakers seek clarification from Meta regarding influencer concerns
Taking Aim at Meta: Parliament Pushes for Swifter Action Against Finfluencers
In a bold move, a group of MPs is putting Meta on the hot seat, demanding a rundown of the company's history responding to requests to scrub damaging content from finfluencers. This push follows the Financial Conduct Authority (FCA) slamming Meta as the industry's worst offender in responding to such requests.
Meg Hillier, the Chair of the Treasury Committee, fired off a letter to the social media behemoth this week, after the City watchdog shared with her cross-party panel that Meta took a leisurely six weeks to act on their request to squash harmful content.
Quoting from an April evidence session with the FCA's consumer investments chief, Hillier's letter points to concerns raised by the watchdog regarding the lengthy response times encountered when they tried to yank alerts on individual influencers from the Facebook and Instagram realm.
"In October last year, when we issued a number of alerts on individual influencers... it took Meta up to six weeks to act from those requests from the date that a warning was issued and the takedown was requested," the excerpt quoted in the missive reads. Lucy Castledine, the FCA's consumer investments chief, then chimed in, voicing that "Other platforms are more responsive."
A month down the line, the committee is now calling on Meta to lay out the reasons for these six-week delays in responding to an FCA demand and provide the total number of days that Meta has allowed such posts that the FCA requested to be axed to stay live.
A Meta spokeswoman countered the criticism by describing the instance brought up by Castledine as an "isolated incident" that stemmed from delays in responding to a "small number of reports" from the FCA. She added that these delays had been remedied, and all other relevant reports made by the FCA have been expedited.
However, this explanation didn't quite quiet the concerns about the consistency of Meta's response times. To boost their efforts, regulatory bodies, like the FCA, are placing greater emphasis on the importance of collaboration among social media platforms to weed out harmful content more efficiently.
The timing of the committee's letter coincides with the announcement of a separate crackdown on finfluencers, or those who peddle investments and get-rich-quick schemes on social media. The FCA led this operation in conjunction with nine international counterparts from Australia, Canada, the United Arab Emirates, and other jurisdictions.
The international operation yielded the arrest of three individuals in the UK, with four others being hauled in for questioning. Steve Smart, the FCA's joint executive director of enforcement and market oversight, urged finfluencers to toe the line, reminding them that they must only promote financial products where they are authorized to do so or face the consequences.
The FCA's stance on tackling financial misinformation and combating scams online has been demonstrated by its relentless pursuit of high-profile reality TV stars and social media influencers who have been charged for peddling unauthorized trading schemes. Last year, its legal team took on several big names, including Emmanuel Nwanze and Holly Thompson, who were accused of using Meta-owned Instagram account @holly_fxtrends, to solicit investments in 'contracts for difference.'
In the face of mounting pressure from watchdogs and the public, Meta appears to be entering a critical juncture where its prompt and effective response to requests to scrub damaging content from finfluencers will be paramount in shaping its future in the online financial advice landscape.
- As Meta struggles to address the concerns of regulatory bodies, such as the FCA, regarding their response times to requests to remove harmful financial advice from finfluencers, the company may benefit from seeking advice on improved procedures and timely action from industry experts in finance and technology.
- In light of the recent international crackdown on finfluencers and the emphasis placed on collaboration among social media platforms, it is essential for businesses, particularly those in the finance sector, to ensure that their insurance policies cover potential liabilities arising from non-compliance with financial regulations and harm caused by misleading information.
- With the increased scrutiny of finfluencers and the push for more general-news outlets to provide accurate and responsible financial information, it's crucial for investors to rely on reliable sources for financial advice and stay informed of the latest developments in the finance industry to make well-informed decisions.
