Finfluencers are a risk, global watchdog warns

Staff reporter

Financial influencers present risks to retail investors and authorities should enhance their monitoring and detection efforts, says Jean-Paul Servais, chairman of the International Organization of Securities Commissions.

Finfluencers are those who use social media platforms to spread investment ideas, wealth management advice and personal finance guidance.

Speaking via video to the Asia Securities Industry and Financial Markets Association's annual conference in Hong Kong, Servais acknowledged that finfluencers help popularize financial topics and offer investors information. But he also emphasized the need for better detection of conflicts of interest and disclosure practices because of the potential risks they pose.

The IOSCO has developed specific strategies to retail investors and mitigate risks of fraud and mis-selling, amid evolving technology and increasing integration across retail and financial markets, Servais said.

The Securities and Futures Commission's executive director of intermediaries Eric Yip Chee-hang said the SFC is set to unveil a road map for virtual assets by the end of this month in response to industry feedback on products and regulatory requirements.

Yip noted that Hong Kong's licensing and regulation of virtual asset trading platforms have responded well and that licensing is only the first step before the business' sustainable development.

Hong Kong Monetary Authority chief executive Eddie Yue Wai-man said Hong Kong should step up efforts in digitalization and cement its advantages in finance.

Yue emphasized that digitization and innovation to reduce costs and enhance efficiency to capitalize on future opportunities.

The HKMA chief said the city must improve the safety and reliability of financial services to support trade and investment in the region.

Additionally, authorities will further strengthen Hong Kong's listing regime and trading mechanism, said Secretary for Financial Services and the Treasury Christopher Hui Ching-yu, adding that the government and market regulators, as well as Hong Kong Exchanges and Clearing (0388), will continue to explore various measures.