SC: Promotion of certain capital market products on social media may require licence

KUALA LUMPUR: Promotion of a capital market product on social media platforms may require a licence from the Securities Commission Malaysia (SC) in certain circumstances, according to the updated version of SC's guidance note on the provision of investment advice.

"For example, the sharing of financial insights or recommendations that promote certain capital market products to followers with expectation of commissions or other rewards will require a licence," the SC said in a statement today.

The regulator has updated the guidance note at https://www.sc.com.my/regulation/guidance- notes-and-guiding-principles, with the infographic is available at https://www.sc.com.my/investor-empowerment/info-on-finfluencer.

It said the move aims to address the growing popularity of financial influencers (finfluencers) promoting capital market products and services on social media, as well as to create greater public awareness.

"Finfluencers should take note that engaging in unlicensed regulated activities is an offence which is punishable under the Capital Markets and Services Act 2007 (CMSA).

"Any person found guilty may be liable to a fine not exceeding RM10 million or imprisonment not exceeding ten years or both," it said.

The SC said finfluencers should verify that the companies they promote are licensed or approved by the SC by using the SC’s Investment Checker.

"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," it added.- Bernama