City cracks down on financial advertising

An intensified crackdown on illegal financial advertisements is to be carried out in the city, Shanghai's market watchdog said on Monday. A particular target will be the release of financial ads without the relevant financial business license.

A notice on strengthening supervision and management of financial ads was released recently by nine government authorities, including the Shanghai Administration for Market Regulation and Shanghai Financial Regulatory Bureau, the administration announced.

"We have detected unclear and even fake promotions in financial advertisements and some agencies without relevant licenses are conducting relevant businesses, which severely mislead the public and lead to their losses," said Feng Yao, an official with the bureau.

"Apps and online platforms are the hotbeds of illegal financial ads," he added.

The notice requires market entities to conduct businesses with licensed financial service providers within allowed scopes and bans unlicensed market entities from promoting financial business.

Financial advertisements should guide the public to make investments rationally and avoid promoting unlimited consumption or trapping the public into purchasing improper financial products or services, the notice states.

Financial ads with investment purposes should clearly specify relevant risks and responsibilities involved and remind consumers of potential risks.

The administration cracked down on 13 cases regarding illegal financial advertisements this year with total fines of 293,000 yuan (US$42,895) imposed.

Elderly people and university students are particularly targeted in illegal financial ads, authorities said.