FSA warns on misleading Internet advertising

FSA warns on misleading Internet advertising

One in four promotional Web sites operated by financial services firms fail to present information in a "fair, clear and not misleading way", says the UK's Financial Services Authority (FSA) following a review of advertising on investment sites.

The year-long review involved 130 visits to 77 firms' Web sites. Each visit to a Web site replicated the type of journey a customer may be making through the service, says the FSA.

The study found that three quarters of sites met the standards required, but one-in-four were difficult for consumers to navigate and failed to highlight key information.

This is partly because firms are not placing enough emphasis on the customer journey and general Web site design when placing key information, says the watchdog. In some instances general Web site maintenance was also lacking, resulting in out-of-date or incorrect information being provided to consumers.

The FSA did not name the firms operating the sites that fall short, but says it will carry out another review in March 2008 and will take action if it finds further failings.

Dan Waters, Director of Retail Policy and Themes at the FSA, says for many customers the Internet is the channel of choice for shopping around for financial products, but it can expose consumers to high risk as they are able to make instant purchases without advice.

"We expect the senior management of all regulated firms to ensure their customers are treated fairly - and we will be looking at promotional Web sites again early next year to make sure that firms have taken our findings on board and are taking Web site design seriously," adds Waters.

But the watchdog says standards have improved since it stepped up its supervision of Internet-based promotions following reviews in 2005 and 2006, which identified widespread failings.

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