Advertisers attack FSA over regulatory plan
The Incorporated Society of British Advertisers (ISBA) has accused the Financial Services Authority (FSA) of trying to reduce the effectiveness of financial service products’ advertising.
ISBA’s accusation follows the publication of a new FSA consultation paper on its latest regulatory plans.
The FSA wants to regulate the use of past performance statistics in financial services advertising, which it does not believe to be a reliable guide to future performance.
Investment marketing relies heavily on the use of past performance statistics in its advertising, to persuade customers to buy funds and other investments.
According to ISBA, regulations on the use of past performance statistics in advertising could result in the dropping of advertising for individual investment products in favour of greater generic brand advertising. This, says ISBA, will ultimately deny the consumer legitimate product information.
ISBA director of public affairs Ian Twinn says: “The FSA’s proposals to regulate the use of past performance data appear to rest on a fundamental belief that this is never relevant information for the consumer. ISBA does not believe the FSA has satisfactorily established this fundamental point.”
ISBA recently called on the Government and the FSA to spend money to promote saving and make products such as ISAs accessible during a closed-door meeting with the FSA and financial services companies (MW May 30).
