The Financial Services regulator has instructed two financial
web sites to stop publishing summaries of newspaper share tips
because it says that on-line publication constitutes investment
advice, which is not permissible in an unregulated environment -
and is therefore illegal financial advice.
The two sites are Sharepages.com and Digitallook.com. The former
has 270,000 users. Newspapers and financial periodicals were
exempted from the restrictions on publishing tips in 1986 and they
can publish them on their own web sites. Accordingly,
Sharepages.com is now linking its tips page to the web sites of
national newspapers.
The Financial Services Authority is understood to be discussing
with the Treasury the possibility of extending the exemption
enjoyed by newspapers to cover other web sites. A spokeswoman said:
“We are not banning share tipping where people are authorised, but
we are here to protect consumers.”
In March this year, the FSA warned against following tips on web
sites and in internet chat rooms. FSA Managing Director Phillip
Thorpe said:
“There is potential for the unscrupulous to
place false or misleading messages in order to make money for
themselves. Following such tips blindly can seriously damage your
wealth. So the simple message is do not believe everything you
read. Do some research - the internet can make that easy and cheap
- and make sure that your share purchases and sales are an informed
decision.”
