Alvin Tan: Fewer than 5 complaints per year against ‘finfluencers’ to MAS over 5 years

SINGAPORE: Over the past five years, the Monetary Authority of Singapore (MAS) received fewer than five complaints annually against online “finfluencers,” according to Minister of State for Trade and Industry Alvin Tan.

Most of these complaints were related to remarks made by “finfluencers” who were not offering financial advice and, as such, were not subject to MAS regulation, he added.

Tan, who also serves as a Board Member of MAS, provided this update in response to a question filed by Radin Mas SMC MP Melvin Yong in Parliament on Wednesday (13 Nov).

Yong inquired whether MAS had received complaints over the past five years against online “finfluencers” discussing financial content, how many complaints there were, and whether the Ministry plans to review the Financial Advisers Act 2001 to regulate the “finfluencer” sector.

In response, Tan noted that MAS, along with the Commercial Affairs Department, will take enforcement action against individuals providing financial advice without a licence.

Over the past three years, enforcement action has been taken against six individuals, none of whom were “finfluencers,” he added.

Melvin Yong raises concerns over unregulated ‘finfluencers’ influencing public opinion and consumer risk

In his supplementary question, Yong expressed concerns over the influence of “finfluencers” on their viewers, pointing out that many of them include disclaimers that their content should not be interpreted as financial advice, yet they still hold sway over public opinion.

He highlighted the risk to consumers due to the unregulated nature of finfluencers’ financial recommendations, citing the collapse of the FTX platform in the United States, where finfluencers had promoted the platform prior to its failure.

He noted that in such cases, consumers might only have civil claims as recourse, which is unprecedented in Singapore’s courts.

Yong asked if MAS had a stance on whether finfluencers owe a duty of care to their viewers when promoting financial products and whether MAS could develop industry guidelines that clarify the responsibilities of finfluencers and consumers.

He suggested such guidelines could help leverage finfluencers to enhance financial literacy while protecting vulnerable consumers.

Yong is also the President of the Consumers Association of Singapore (CASE).

Alvin Tan: Only regulated financial advisory firms can provide investment advice under FAA

In response, Tan reiterated that only financial advisory firms and their representatives, who are regulated under the Financial Advisers Act (FAA), are allowed to provide advisory services on investment products.

He clarified that if a finfluencer provides financial advice, they must be registered as a representative of a licensed financial advisory firm.

He also emphasised that MAS regularly advises the public to only seek advice and invest through MAS-regulated individuals and lists unregulated persons on its Investor Alert list to warn the public about unlicensed entities.

Tan assured Yong that MAS encourages consumers to report suspected wrongdoing, which MAS investigates and, if necessary, addresses through regulatory action against unlicensed financial advisory activities or non-compliant advertising.