Financial Services, Pensions and Digital Economy Minister Senator Jane Hume is wrong to dismiss influencers as undeserving of regulation, according to the Stockbrokers and Financial Advisers Association (SAFAA).
Speaking at the MarketLit forum, Judith Fox, chief executive of SAFAA, highlighted comments made by the minister in September when she said the government would not seek to ban them.
“Hume said ‘buyer beware, we are not going to regulate you, do whatever you want’; she said the influencers are the same as the guy at the pub or a cab driver, ”Fox said.
“Well, there are some issues with that because the cab driver or the ‘guy at the pub’ might only have one person listening to them while on social media we’re talking hundreds, thousands. , potentially millions of followers. “
Fox said this was an inaccurate comparison because the cab drivers and the “pub guy” didn’t have the influence or followers the way influencers did.
“No google cab driver or guy in the pub asking for financial advice and the other problem is that people giving opinions or comments could often make money based on how many views they get. Fox said.
“While there is nothing wrong with that, it is a problem if he gets lost in giving financial advice because they have not sat the [adviser] exam, they don’t have a diploma and they don’t have a license, they don’t have 40 hours of CPD [continuing professional development] per year that they must complete.
“Worst of all, there is no consumer protection and that is the very big missing piece. In social media and unregulated financial advice, there is no protection for consumers, who in the regulated world there are important protections.