Consumers have more choice in how they invest their money than ever before thanks to the many positive ways that technology has impacted the financial services sector.
However, the speed of this change means that consumers also need to be more protected from advertising fraud on online platforms, according to the FCA's Chairman, who says that he believes legislation should be introduced.
In the same speech at the Cambridge International Symposium on Economic Crime, he also referenced Kim Kardashian advertising Ethereum Max, and stated that "it is essential that the boards of FCA authorised firms can show how they have addressed the risks that unregulated activities in relation to digital tokens can pose"
Whilst the regulator has been supportive of innovation in the financial services sector, they will clearly continue to ensure that firms are addressing the risks that these technologies pose to both themselves and their clients.
It also means that the insurance policies that afford protection against these risks are updated to reflect the changing landscape. In my experience, this isn't always the case, with many outdated policy wordings still being widely used to protect financial services firms. And whilst many of these still offer comprehensive cover, it's crucial that firms ensure that their insurance programmes can respond to the new threats that continue to emerge.
“Online platforms should expect a future where regulation addresses the significant risks they pose in the same way as other businesses. Same risk, same regulation”