The FSA has published the results of a recent thematic review of outside financial promotions. The FSA reviewed products that fell within the remit of the relevant chapters governing financial promotions in the Conduct of Business sourcebook (COBS 4), the Insurance Conduct of Business sourcebook (ICOBS 2.2) and the Mortgages and Home Finance Conduct of Business sourcebook (MCOB 3).
Findings from the review include:
- The FSA was generally satisfied with the level of compliance achieved by the majority of the outdoor promotions reviewed.
- Some firms appeared to have difficulty in determining whether promotions (particularly for investment products) were exempt from the detailed financial promotion rules.
- Firms did not always provide the capital-at-risk or past performance risk warnings that were required to ensure their outdoor promotions were compliant.
- Some firms marketing high risk products assumed a relatively sophisticated target audience for their promotions, despite the outdoor advertising medium being inherently unable to target a specific audience.
The FSA also briefly discusses:
- Exempt promotions.
- Image advertising - investment, insurance and mortgage products.
- Target audience and stand alone compliance.
- Investments (COBS 4) - capital at risk and balance.
- Investments (COBS 4) - past performance.
- Insurance (ICOBS 2.2) - price saving claims.
The FSA concludes by setting out examples of good and poor practice that it found during the review.
View Review of outdoor financial promotions - June 2009, 19 June 2009