On Wednesday 28 May, the Chair of the European Securities and Markets Authority (ESMA), Verena Ross, urged a series of online platforms to take “proactive steps” to prevent the promotion of unauthorised financial services.
“The increasing spread of online scams targeting retail investors poses a serious risk to investors themselves and to society as a whole, with fraudulent actors exploiting digital platforms to advertise unlawful financial services”, Ross wrote in a letter sent to social media companies Meta, Apple, Google, Amazon, Alphabet, X, Tik Tok, Telegram, Reddit and Snap.
“These activities often mislead consumers into engaging with firms that lack proper authorisation resulting therefore in financial losses and also in the loss of trust in the financial sector and, more widely, in social media platforms and in the digital environment”, said the Chair of ESMA.
The latter encourages platforms to take account of the measures recommended by the International Organization of Securities Commissions (IOSCO) in a statement published on 21 May. IOSCO is calling for the authorisation of entities promoting financial products to be verified and for collaboration with regulators.
Ms Ross also noted the existence of an ESMA public register, which - under the MiFID II Directive - makes it possible to check whether a firm is authorised to provide investment services by an EU supervisory authority.
See ESMA’s letter to Meta: https://aeur.eu/f/h4q
See the IOSCO statement: https://aeur.eu/f/h4r (Original version in French by Bernard Denuit)