The Securities Commission Malaysia (SC) has updated its guidance on providing investment advice, specifically targeting the growing influence of financial influencers, or “finfluencers,” on social media.
The updated Guidance Note on the Provision of Investment Advice aims to clarify the SC’s regulatory expectations for finfluencers who share financial insights and recommendations online.
The SC stresses that providing investment advice is a regulated activity under securities laws, and the same rules apply to finfluencers.
Notably, the updated guidance note specifies that promoting capital market products on social media may require a license from the SC in certain situations.
For instance, sharing financial insights or recommendations that promote specific capital market products to followers, expecting commissions or other rewards, will necessitate a license.
The SC warns that engaging in unlicensed regulated activities is an offence under the Capital Markets and Services Act 2007 (CMSA), punishable by fines up to RM10 million, imprisonment up to ten years, or both.
To help finfluencers comply with the CMSA, the SC has published an informative infographic featuring frequently asked questions and a checklist.
Finfluencers are advised to verify the licensing status of companies they promote using the SC’s Investment Checker.
The regulator said in a statement,
“The SC, as part of its discharge of its regulatory function, actively monitors the capital market and will continue to address any developments and trends by, amongst others, issuance of guidance to the public. The regulator will take actions, where necessary, towards ensuring a fair and orderly market.”
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