ASIC renews warning on financial services advertising
The Australian Securities and Investments Commission (ASIC) has issued updated guidance on the advertising of credit products at the same time as warning promoters and the publishers of such advertising that it will be regularly reviewing the advertisements.
At the same time the regulator has pointed out that since it issued its original guidance in February, 54 advertisements across the financial services and credit sectors had been withdrawn or remedied following ASIC action.
The new ASIC guidance, an update to its Regulatory Guide 234, has emphasised the need for advertising to contain balanced messages about the returns, features, benefits and risks of a product or service, including warnings, disclaimers, qualifications and fine print.
Dealing with fees and costs, the guide states that where a fee or cost is referred to in an advertisement, it should give a realistic impression of the overall level of fees and costs a consumer is likely to pay, including any indirect fees or costs.
The guidance has also warned about the use of specific words and phrases, stating that terms and phrases should not be used in a particular way by the industry "where these are not consistent with the ordinary meaning commonly recognised by consumers (e.g. 'free', 'secure' and 'guaranteed')".
It said industry concepts or jargon should be avoided unless the promoter is confident that the audience will understand these terms.
Commenting on the upgraded guidance, ASIC Commissioner Peter Kell pointed to the number of advertisements which had been withdrawn or amended since the issue of the original guidance.
He said the ads had "raised concerns about poor practices and potentially misleading and deceptive conduct".
"ASIC has shown that we will take swift action when confronted with misleading and deceptive advertising," Kell said.
"When we see false claims, we will seek outcomes that involve potentially stronger penalties than we have sought in the past."
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