Norwegian Financial Supervisory Authority warns social media finfluencers about authorisation, disclosure and liability risks when promoting high risk investments

The Norwegian Financial Supervisory Authority has issued a warning about a rise in social media actors promoting complex, high-risk investment opportunities and the risk that followers are influenced into products they do not understand or cannot afford to lose. It stresses that those who publish recommendations can be held legally liable for losses and clarifies that personalised investment recommendations are treated as investment advice, which is a regulated investment service requiring authorisation. The authority underlines that it is not permitted to market or recommend investment service providers without authorisation, or to promote financial products without clear and sufficient information about risks and how any potential returns may arise. It calls on influencers to label paid promotions and disclose collaborations, benefits or kick-backs, ensure communications are truthful, balanced and not misleading, and avoid presenting themselves as experts on products they do not fully understand. Examples of frequently promoted high-risk instruments include contracts for difference, foreign exchange, futures, crowdfunding projects and cryptocurrencies, where investors may lose all invested funds; influencers are urged to check that any firm or platform they reference is allowed to operate in Norway, and followers are advised to be sceptical of unrealistic promises of quick, high returns and to seek safer saving and investment advice from their bank. The regulator also points to a European Securities and Markets Authority factsheet for finfluencers and references a joint webinar with the Norwegian Consumer Authority on the applicable rules.