Publicity for the protection of financial consumption rights and interests on March 15, 2021 (II)

2021-06-05 18:06:43

Enhance the identification ability and risk awareness of illegal financial advertisements and maintain the safety of consumer finance

Financial advertising activities are inseparable from people’s daily life. While such campaigns can improve people’s access to information, criminals can also use people’s behavioral habits to launch illegal financial advertisements through various channels and platforms, mislead financial consumers to buy financial products and services that do not meet their own risk preferences, and even lure financial consumers into participating in illegal financial activities through eye-catching advertising. According to Advertising Law of the People’s Republic of China, Guiding Opinions on Promoting the Sound Development of Internet Finance, Implementation Plan for Carrying out Internet Financial Advertising and Specific Rectification of Financial Activities in the Name of Investment and Wealth Management, The General Office of People’s Bank of China on Financial Advertising Governance, Notice of People’s Bank of China, Bank of China Insurance Regulatory Commission, China Securities Regulatory Commission and the State Administration of Foreign Exchange on Further Regulating the Publicity Behaviors of Financial Marketing and other relevant laws, regulations and normative documents, financial consumers can start with awareness of the basic characteristics of financial advertisements and their own ability to prevent risks when they can confirm the authenticity and legitimacy of financial advertisements.

(I) Several points that financial consumers shall pay attention to when identifying the authenticity and legitimacy of financial advertisements include, but are not limited to: 

1. Financial consumers can distinguish whether financial advertisers have obtained corresponding financial business qualifications before launching financial advertisements and whether the contents of financial advertisements are consistent with the obtained financial business qualifications in form and substance, such as advertising deposits and credit loans in the name of investment and wealth management, investment consultation, loan intermediary, credit guarantee and pawn.

2. Financial consumers can distinguish whether the financial advertisements published on an internet platform are identifiable as such, and clearly marked as “advertising”.

3. Financial consumers can distinguish whether financial advertisements have reasonable hints or warnings for possible risks and risk liabilities of financial products or services, such as language like “investment is risky”.

4. Financial consumers can distinguish whether financial advertisements make a guaranteed commitment for the future effects and benefits of financial products or services or commit related violations, and indicate capital preservation and risk-free or guaranteed earnings, whether explicitly or implicitly.

5. Financial consumers can distinguish whether financial advertisements exaggerate or unilaterally publicize financial services or financial products and make false or exaggerated statements regarding past performance without providing any objective evidence.

6. Financial consumers can distinguish whether financial advertisements falsely publicize the earnings and security of investment and wealth management products, and otherwise deceive or mislead consumers.

7. Financial consumers can distinguish whether financial advertisements illegally use the names or images of academic institutions, industry associations, professionals and beneficiaries as marks of recommendation or certification.

8. Financial consumers can distinguish whether financial advertisements illegally publicize activities that are prohibited by relevant national laws and regulations and the competent department of the industry.

(II) Financial consumers shall enhance their awareness of risk responsibility

When financial consumers are exposed to financial products and services through advertisements, they shall firstly understand relevant basic knowledge, consult professional practitioners through formal channels, make cautious choices according to their own risk tolerance, and resolutely stay away from illegal financial activities. When financial consumers are exposed to financial advertisements, they can enhance their discrimination ability through the following “three Mores” steps before making a final decision:

The first is to ask more. Advertisements involving specific financial products shall be granted corresponding financial business qualifications. You can inquire whether the company has the qualifications to issue financial products and launch advertisements, and the salespersons have their qualification certificates, and check the risks and target groups of the products.

The second is to think more. Before buying financial products and services, you can think about the risks of financial products in advertisements, and your risk tolerance. You shall be responsible for your own financial decisions. High earnings are often accompanied by high risks. When the earnings presented in financial advertising are attractive, you should conduct a risk tolerance evaluation to learn about your own risk preferences as part of making wise decisions.

The third is to learn more. In the internet age, financial advertisements emerge endlessly, and financial products and services are varied and dazzling. However, the nature of finance has not changed. Financial consumers shall learn and understand basic financial knowledge and skills, cultivate good financial behaviors and attitudes, and improve their financial literacy so as to cope with the ever-changing financial market.