Chris Green of ASIC advises what brokers should be watching out for with regards to advertising regulations.
Video transcript below:
Chris Green, ASIC
Chris Green: Our brokers should ensure that they are advertising is accurate, supported by evidence and balanced, that brokers should get good legal and compliance advice before they publish an advertisement and that ASIC has a strategic priority of informed consumers and we actively monitor this area and take action where necessary.
Advertising plays a crucial role in consumer’s decisions about financial products and that is why advertising is our focus for the commission at the moment. First important thing to say is that when claims are made in advertising, it’s important that those claims are accurate and that they are supported by evidence. For example, if you make a claim in an advertisement that a product is free, then that product can’t have any hidden costs or transaction fees or anything like that. Otherwise they will be in danger of being misleading. Brokers also need to take particular care when making a claim about consumers getting projected savings where those savings are not yet evident. It is also important that an advertisement contains balanced information to ensure that the ad gives an overall impression that is realistic about the product or the service. For example a particular product may be cheap, but it also may have strict limitations or extra costs and all of that needs to be reflected in an advertisement. The obligations around advertising are important legal obligations, so my best advice to brokers is that they get robust legal and compliance advice before they publish an advertisement. We have issued the guidance that I talked about earlier and that contains examples, real examples from the credit industry where brokers and credit providers have tripped up with misleading advertising. So if brokers and their advisors read our guidance they may be able to learn from mistakes of others.