Contact State responds to FCA’s proposals to clamps down on financial marketing

In response to CP22/27 – the FCA’s proposals to clamp down on illegal, unfair or misleading financial marketing – Alain Desmier, Managing Director of Contact State and author of Data Control Matters – a report into data consent within financial services – said: “Accountable financial advertising will be a recurring theme for the FCA in 2023 and today’s news is a continuation of the Consumer Duty and commentary of that paper.  The financial regulator wants to see firms create more robust signoff procedures of financial promotions and will achieve its aims through direct intervention, firm and control function accountability. In black and white, if you run the marketing and / or compliance function of a financial firm, these proposals (CP22/27) should feature in your new year’s resolutions.

“Lead generation for products like insurance and mortgages is classified as financial promotions and so this document also applies to anyone buying or creating leads. Compliance does not need to be onerous or scary, firms just need to keep a real time record of the adverts and landing pages that are being used to create consumer leads they are speaking to.”

I hope the comment is useful. You may also find these insights from Data Control Matters which surveyed 5,000 consumers about searching and buying financial products online useful context for the kind of ‘rogue marketing’ consumers are subject to.  The data found that while consumers increasingly want to go online and compare mortgage quotes, they have growing concerns about the security of their personal information – 24% say they have felt ‘forced’ to share their data to get a quote and 29% had a negative experience when getting a quote. Of those who have had a bad experience:

  • 24% of respondents it was unclear they’d have to submit personal details to receive an online mortgage quote
  • 24% expected to receive an online quote but were called instead
  • 29% were contacted by a company different from the one they submitted their details
  • 30% say they were called and texted too much after getting a quote
  • 63% of consumers would be unhappy if they filled in a form for a quote with one company, but were called by a different one
  • 90% say the fact their number has been passed on makes them feel ‘concerned about their data’

Alain Desmier, Managing Director of Contact State adds: “Gone are the days of getting one mortgage quote and then proceeding – people want to take more control of their financial decisions. However, our data shows that the landing pages they are seeing when they search for quotes are becoming increasingly ‘deceptive’, presenting themselves as an instant quote or calculation when in fact, they are lead generation pages, and this is causing them to feel quite negative towards the entire experience. So, if brokers are buying data or leads from a source they don’t understand, and the customer has had a negative experience getting to them, not only are the less likely to buy, but as the buyer of that lead, the mortgage firm/broker could well be in breach of the Consumer Duty and if they come into force, the new rules proposed by the FCA today.”