Spanish securities regulator CNMV demanded that large search engines, social networks, and other platforms stop advertising on sites not licensed to provide financial services or investments. The regulator also said that it will promote regulation of the matter if companies don’t address it.
Spanish Regulator addresses Unregistered Platform Advertising Problem
The Spanish securities regulator CNMV is concerned about big internet companies giving space to unregistered investment platforms in order to promote their services. The president of the organization, Rodrigo Buenaventura, referred to this issue in a speech given at an event called “Supervisor, Cryptoactives, and Advertising: good practice in the sector,” where he explained the stance of the CNMV on this problem
Buenaventura said:
I believe it’s unjustifiable for companies to broadcast paid advertisement on search engines and social networks by accepting advertisements from pirate entities. These are public warnings that they have not been registered.
Buenaventura stated, in addition, that the companies were putting customers in danger by advertising these services, leading to various frauds.
The organization has identified many of the fraudulent cases in Spanish courts, which have caused millions in damages and fraud, as being from non-authorized platforms. Buenaventura believes that such problems could be avoided if the platforms had used the lists the CNMV or other European regulators regularly issue to prohibit platforms from advertising.
He explained that he meant:
We ask them to take responsibility for their own self-regulation and ensure that their social media pages or networks are not used for deception, possible criminal acts, in return for their increased income.
The Next Step in Regulation
To protect users of these services, the Spanish regulator will allow these companies some time to incorporate the changes. The Spanish regulator also said that, if it is not satisfied, it would propose regulations to make companies comply.
El Mundo reports that sources from the CNMV claimed it would take only weeks to issue this regulation. The same sources state these companies argue that some issues — technical difficulties, permission from parent companies, and time to analyze and implement measures — have prevented them from complying with the requirements.
Already, the CNMV issued a regulation that requires crypto-related ads targeting over 100K users to inform the regulator in advance.
Let us know your thoughts about the Spanish securities regulator’s stance on advertising unregulated investment platforms. Leave a comment below.
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