FCA fines and enforcement for misleading financial promotions

What happens when a promotion breaks the rules

Usually the FCA asks the firm to change or withdraw it. When it finds a promotion misleading, the FCA says it can “ask the firm to change or remove the advert”, “ask the firm to write to customers who may have been misled”, “warn or fine the firm” or “ban the promotion” (FCA). Behind that list sit powers in the Financial Services and Markets Act 2000 (FSMA). For an authorised firm, the main ones are:

Sources: FCA financial promotions data for 2024 (those VREQs and own-initiative powers were used “to restrict their ability to communicate or approve financial promotions”), and enforcement and skilled person data for 2025/26. Sector trends are in FCA financial promotions data.

The FCA can ban a promotion under section 137S

Section 137S applies where an authorised firm has made or approved a communication, or proposes to, and the FCA considers the financial promotion rules have been or are likely to be broken (section 137S(1)).

A direction under this section may require the authorised person— (a) to withdraw the communication or approval; (b) to refrain from making the communication or giving the approval (whether or not it has previously been made or given); (c) to publish details of the direction; (d) to do anything else specified in the direction in relation to the communication or approval.

• It bites at once. Everything except publication takes effect immediately. The firm can make representations and, if the FCA does not revoke the direction, refer it to the Upper Tribunal (section 137S(4), (6) and (8)).
• Lookalikes are caught. A direction not to make a communication covers any other that is “in all material respects the same as, or substantially the same as” it, where a reasonable person would think another direction would be given about it (section 137S(3)).
• Approvals are covered. An approver can be directed to withdraw its approval, and the FCA must normally notify the business it approved for (section 137S(5) and (12)).
• It can be published once the period for representations has ended, “even if the direction is revoked” (section 137S(11)).

The FCA says it will usually “inform the firm of our concerns and give them an opportunity to respond to those concerns” first, and that a direction will “normally be to withdraw the advert from circulation with immediate effect” (FCA). Registered cryptoasset firms lose their article 73ZA exemption for any promotion made in breach of a direction (PERG 8.14.40DG(3)).

The FCA can restrict a firm or appoint a skilled person

Short of banning one advert, the FCA can impose requirements on a firm, at its request (a VREQ) or on the FCA's own initiative, or vary or cancel its permission. Its examples include “a requirement not to take on new business” (SUP 6B.4.4G), and its standard approach is to publish voluntary restrictions on the Financial Services Register (FCA enforcement data). In August 2025, one motor finance claims company agreed a VREQ to stop publishing new financial promotions and withdraw all existing ones (FCA, 2 January 2026).

Section 166 lets the FCA require a report by a skilled person, or appoint one itself. The FCA sets the scope and the firm pays; the reviews completed in 2025/26 cost an average of £2.5m (FCA, 9 July 2026).

Approvers can lose the permission to approve

Approving a promotion for an unauthorised business requires the FCA's approver permission under section 55NA, unless an exemption applies (see section 21 approval and the gateway). A firm approving outside it “is to be taken to have contravened a requirement imposed on the person by the FCA under this Act” (section 55NA(2)), which exposes it to the disciplinary powers below. The FCA can vary or cancel the permission on its own initiative where the firm has given or refused no approvals for 12 months, or to advance its objectives (section 55NA(5) and (8)).

The FCA has called section 21 approval “not just a formality” (FCA, 7 February 2025). After reviewing 10 approvers, it reported in May 2026 that one firm had to carry out a remediation exercise and some websites were blocked to retail customers (FCA, 27 May 2026).

How the FCA sets a fine

Section 206 lets the FCA impose a penalty “of such amount as it considers appropriate” on an authorised firm that has broken a requirement imposed on it; FSMA sets no maximum. Section 205 allows a public censure instead, and section 66 lets the FCA fine individuals for misconduct or publish a statement of it. DEPP 6, the FCA's penalty policy, sets five steps for a firm:

1. DisgorgementRemoving the financial benefit of the breach, ordinarily with interest (DEPP 6.5A.1G).
2. SeriousnessUsually 0%, 5%, 10%, 15% or 20% of the firm's revenue from the business concerned during the breach (DEPP 6.5A.2G).
3. AdjustmentUp or down for aggravating and mitigating factors, such as prompt reporting and remedial steps (DEPP 6.5A.3G).
4. DeterrenceAn increase if the figure is too small to deter the firm or others (DEPP 6.5A.4G).
5. Settlement30% off, except on disgorgement, if the firm settles in the first stage of the process (DEPP 6.5A.5G, DEPP 6.7.3G).

The FCA censured London Capital & Finance plc (LCF) instead of fining it because the firm was insolvent, saying it otherwise “would have imposed a substantial financial penalty” and would have required restitution under section 384 for losses of “around £237.2m” (Final Notice, 11 October 2023).

Promoting without authorisation is a crime

For anyone not authorised, communicating a financial promotion in the course of business without an authorised firm's approval or an exemption breaches section 21. Under section 25 that is an offence punishable on indictment by up to two years' imprisonment, a fine or both, subject to defences of reasonable belief and of due diligence. The FCA can prosecute these offences itself in England, Wales and Northern Ireland, and its policy is “to pursue through the criminal justice system all those cases where criminal prosecution is appropriate” (ENFG 6.1.1G and 6.1.2G).

The civil consequences can outlast the offence:

If in consequence of an unlawful communication a person enters as a customer into a controlled agreement, it is unenforceable against him and he is entitled to recover— (a) any money or other property paid or transferred by him under the agreement; and (b) compensation for any loss sustained by him as a result of having parted with it.

An unlawful communication is one made in breach of section 21(1). Section 30 does not depend on who made it: where the business enforcing the agreement did not, the court considers whether it knew the agreement resulted from one, and may allow enforcement if that is just and equitable (section 30(4) to (7)). That can reach firms whose customers arrive through affiliates or introducers; see affiliate marketing compliance. Sections 26 and 27 have similar effects on agreements made by, or in consequence of, someone carrying on a regulated activity without authorisation.

On the FCA's application, the High Court can also restrain contraventions and order restitution (sections 380 and 382), as in the Avacade case below. The FCA warns the public through its Warning List, and issued 2,329 warnings about unauthorised or potentially scam firms in 2025 (FCA, 9 July 2026). It also asks platforms to remove content: in one week in April 2026 it made 120 account takedown requests (FCA, 24 April 2026).

FCA cases where promotions were the issue

1. 16 Jun 2014Credit Suisse International and Yorkshire Building Society finedTheir promotions made a structured deposit's maximum return “a key promotional feature” when the chance of achieving it was “close to 0%”, which the FCA called “a serious breach of the requirement to be clear, fair and not misleading”. Fines of £2,398,100 and £1,429,000, after a 30% settlement discount (FCA).
2. 10 Dec 2018London Capital & Finance plc told to withdraw its promotionsDirected to withdraw its promotional material immediately “because the way the firm was marketing its minibonds was unfair, unclear and misleading”. LCF entered administration on 30 January 2019 (Final Notice, paragraph 2.2).
3. 30 Jun 2020High Court rules against Avacade Limited and Alexandra Associates (UK) LimitedThe court found the two companies “made unapproved financial promotions through their websites, promotional material and in telephone calls to consumers and made false or misleading statements”. With three individuals, they were ordered in August 2020 to pay a total of £10,715,000 in restitution; the Court of Appeal upheld the findings in 2021 (FCA, June 2020; FCA, August 2020; FCA, 2021).
4. 11 Oct 2023London Capital & Finance plc publicly censuredCensured, not fined, for failing “to ensure that its financial promotions were fair, clear and not misleading”, including through comparison websites that seemed independent but were not, and minibonds marketed as ISA bonds that did not qualify (Final Notice).
5. 13 Feb 2024Former LCF director responsible for compliance fined and bannedHe “recklessly signed off hundreds of financial promotions”, and the FCA said “the approval process became an ineffective tick-box exercise”. Fined £31,800 after a 30% settlement discount and banned from working in financial services (FCA).
6. 20 Feb 2026Seven influencers sentencedEach pleaded guilty to one count of issuing unauthorised financial promotions, for a foreign exchange trading scheme (FCA). See finfluencer rules in the UK.
7. 20 Mar 2026Conclusive Financial Ltd's adverts banned under section 137SIts social media adverts used clips of the MoneySavingExpert.com founder “edited and spliced together to increase the pace of delivery, which creates a false sense of urgency”. The directions also covered its use of the FCA logo, claims built on its authorisation and an unexplained £1,846 average refund. Published 14 April 2026; the firm removed the adverts (notice; FCA).
8. 16 Sep 2026Two former Vector Wealth Ltd senior managers fined and bannedThe FCA said they “allowed misleading promotions to draw in investors” in high-risk bonds. The former chief executive was banned and fined nearly £270,000. A former senior manager was banned from senior management roles and fined £20,000, reduced from £80,096 for serious financial hardship. Published 21 October 2026 (final notices: chief executive, senior manager; FCA).

What the FCA says draws its attention

The FCA does not approve promotions, but in its words “we do monitor adverts across different media in the UK” (FCA, 9 January 2019). Its latest annual promotions data called unclear and misleading marketing “a big concern because financial products are complex and often long-term”, and singled out claims management, debt advice on social media, cryptoassets, section 21 approvals, finfluencers and buy now pay later (FCA, 7 February 2025). The practices it has acted on include:

Repeat problems escalate. The FCA had written to Conclusive Financial about its promotions between August and October 2025, and called its directions proportionate “particularly given the seriousness of the breaches and the past engagement with the Firm regarding its failure to comply with the financial promotion rules” (First Supervisory Notice, paragraphs 3.3 and 4.2). The standard itself is covered in fair, clear and not misleading.

What to do if the FCA raises a promotion with you

These steps are suggestions drawn from the FCA's rules and published expectations.

1. Withdraw or fix it everywhere it runsA direction can cover communications “substantially the same as” the one it names (section 137S(3)). The FCA asked claims firms to review “websites, social media, banner ads, and paid search ads” (FCA, 31 July 2025). Check the copies affiliates run too.
2. If you approved it, withdraw the approvalAn approver that finds a promotion no longer complies “must withdraw its approval and notify any person that it knows to be relying on its approval as soon as reasonably practicable” (COBS 4.10.2R(2)). With approver permission, it must also tell the FCA within 7 days of withdrawing an approval because of a notifiable concern (SUP 16.31.5R(2)).
3. Keep the recordA firm must keep an adequate record of most investment promotions it communicates or approves, for three to six years depending on the business, or indefinitely for pension transfers (COBS 4.11.1R). Add the FCA's letters, each version that ran and what changed.
4. Find the cause and put customers rightCredit Suisse International's breach included having no “holistic periodic review” of a long-running brochure (Final Notice, paragraph 5.8). The FCA has told claims firms to “assess their promotions, identify risks, and take remedial steps where harm may have occurred”, adding: “This may involve contacting consumers and unwinding contracts without charge where appropriate” (FCA, 7 October 2025).
5. Deal with the FCA openlyPrinciple 11 requires a firm to deal with its regulators “in an open and cooperative way” (PRIN 2.1.1R), and a significant breach of a rule must be notified (SUP 15.3.11R). A penalty can be adjusted for how promptly the firm reported the breach, remedial steps such as “correcting any misleading statement or impression”, and whether the FCA had raised the concern before (DEPP 6.5A.3G).

For tracing the control that failed and reporting it internally, see what fails before the penalty.

The ASA rules on adverts separately

The Advertising Standards Authority (ASA) is a separate regulator of advertising. Its CAP Code covers financial adverts the FCA does not regulate, and the non-technical side of those it does, such as social responsibility (CAP Code, section 14). In January 2026 it ruled that poster and video ads for CB Payments Ltd t/a Coinbase, implying cryptocurrency could answer cost-of-living worries, “trivialised the risks associated with cryptocurrency investment”, in breach of CAP Code rule 1.3 on social responsibility (ASA ruling). In July 2026 it ruled that Capgroup Int Ltd's whiskey cask and gold coin investment website should have said the investments were unregulated, and that section 14 risk warnings must be “in the initial ad and not later in the consumer journey” (ASA ruling). In both cases the ads must not appear again in the form complained of.

Connor reads a promotion (an image, video, PDF, web page or social post) and works out which rules apply from the firm's home regulator, the markets it targets and the products it promotes. Each finding quotes the words it is about, cites the rule and links to the regulator's text. A person at the firm makes the decision, and Connor keeps the record: every version, the rules as they stood that day and who decided what.