French authorities have rolled out a licensing program for influencers involved in financial products including cryptocurrencies citing investor protection concerns.
The Autorité des Marchés Financiers (AMF) and the Autorité de Régulation Professionnelle de la Publicité (ARPP), two French agencies, jointly set up a training scheme for influencers to ensure best practices around advertisements.
A successful completion of the program would earn participants a non-obligatory “Responsible Influence Certificate.” The certificate was initially introduced by the ARPP in 2021 and has been issued to over 1,000 influencers so far.
Per the announcement, the certificate would be issued for influencers in markets like stocks, bonds, ETFs, derivatives, investment products, and cryptocurrencies after the course.
Marie-Anne Barbat-Layani the head of AMF states that the nature of the financial market needs tighter regulation for investment protection amid the prevalent scams recorded yearly.
“Protecting retail investors is our top priority. If a publication by an influencer is paid for, the public must be informed. Finance is a highly regulated sector, and investment communications must comply with the rules and be clear, accurate, non-misleading, and balanced. It appears that some influencers are unaware of this.”
Layanu added this move will professionalize the field and make it more uniform. The ARPP’s General Manager Stephane Martin highlighted that the action is beneficial to all parties.
“As part of its statutory mission to promote fair, truthful, healthy, and responsible advertising for the benefit of consumers-citizens and professionals, the ARPP has set up the Responsible Influence Certificate, which contributes to its prevention actions and to the education needed by content creators in the context of their commercial influence activity.”
To pass the course and obtain the certificate, influencers must score 75% out of a total of 25 multiple-choice questions.
Authorities move to check influencers
A notable feature of the digital asset market is the growing popularity of crypto influencers to drive adoption around products.
A major criticism leveled against most influencers is a lack of due diligence to test the efficiency of the platform and its regulatory requirements leading to loss of investor assets.
In June, TikTok influencer pleaded guilty and has been ordered to forfeit $1.2 million in Bitcoin (BTC) as well as fiat and other assets.
Celebrities like Kim Kardashian have also fallen under the regulatory net of the Securities and Exchange Commission (SEC) over touting an unregistered crypto product.
According to the SEC, she was fined $1.26 million for the paid crypto ad pushing more regulators to develop new techniques to curb the trend.
In the UK, authorities have repeatedly warned that their crypto promotions if found fraudulent could attract a two-year jail term with huge fines. In May, the French Senate gave the go-ahead to crypto companies to hire social media influencers for product promotions.