MFSA Warns Regulated Entities on Marketing Campaigns of Financial Products via Giveaways

The Malta Financial Services Authority (MFSA) recently issued a communication to regulated entities, noting that their marketing campaigns related to financial products or services linked to rewards or giveaways must meet a series of requirements.

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Specifically, the regulator warned regulated entities that gifts can only be offered in cases where these are related to the product or service being offered and/or enhances the value thereof. In addition, the gift should not be of substantial value.

Furthermore, regulated entities are required to as much as possible avoid making unsolicited or unarranged calls to clients unless requested by the client. In calling clients or potential clients, the regulated entity shall amongst other things ensure that the persons making the call do not use undue pressure on the client and do not promote any complex products.

Moreover, promotional materials should be reviewed before they are launched (ex-ante) by the respective Compliance Officers to ensure that they are compliant with the applicable rules.

“Consumer’s decision should not be clouded by the potential acquisition of any kind of reward which is not linked to the product itself, nor should this decision be rushed by the pressure of obtaining any sort reward or the possibility to obtain any sort of giveaway or to participate in a lottery,”the regulator stated.