/ Money

Has an advert ever made you rich? Didn’t think so…

Has the presenter on the telly promised you you’ll be rich, or guaranteed you a premium offer which isn’t actually available to you? Our prognosis – financial advertitis, where ads promise more than they deliver.

I’ll wager that it’s not possible to go a day without spotting a misleading advert.

We’re bombarded with promotions on TV, street posters, text, newspapers, pretty much everywhere.

And it’s fair to say that advertisers are not always whiter-than-white about the tactics they employ to get your cash.

Financial adverts under the microscope

When we took a look at financial ads, we didn’t have to search too hard to find six promotions that we felt breached consumer law.

Examples include an investment firm that supports its ad with quotes from national newspapers that appear to endorse the product. On closer inspection, the firm was also the source of quotes. Another is littered with references to a price ‘guarantee’ that is only relevant to a small proportion of people who fit a certain criteria.

I can understand the pressure marketing departments are under to produce ads that will snaffle customers from their competition – I’ve seen Mad Men. But there are rules governing what’s right and wrong, and from what I’ve seen, too many overstep the mark.

Annoying adverts are one thing, but potentially crooked promotions are another. Spotting the difference isn’t straightforward, which is why we need the regulators to take a tough stance.

Watchdog should be ready to pounce

So, what’s the cure? Currently there is little to suggest that providers of dubious adverts will get hammered by the regulator – in this case the Financial Services Authority (FSA).

But pretty soon the FSA will be replaced by the Financial Conduct Authority and its chief, Martin Wheatley, shared some of his ambitions here on Which? Conversation last week. We hope that the new watchdog will bare its teeth, rather than be a lapdog. The FCA will have greater powers to name and shame financial providers who peddle questionable ads, and impose fines.

Have you spotted a questionable claim in a financial ad on TV, radio or in a newspaper?


I find words like majority being used all to often. As in “the majority of our customers” when in fact its only likely to be 51% and yes it might be grammatically correct. So why not say 51% maybe cos 51% doesn’t seem to be that much really. Seems like they go out of their way to hide the true meaning of whatever they’re saying or selling.

It’s a surprising fact to many that the financial services industry does not create wealth. For every person that makes a capital gain on their investment, there has to be a loser. So anyone that claims that they will make you rich must be lying, or their scheme is flawed or crooked in some way.

Ask yourself: If this investment is so great, how can the promoter make even bigger gains by sharing it with others? If lots of investors take up this offer, where are the losers? Without enough losers, where will my profit come from?

It follows that anyone with an investment “opportunity”, devalues it by advertising it to the general public. Why would they do that, unless they are more interested in taking fees and commissions, or propping up a Ponzi scheme?

Another possible reason I should have included above:

To fire up a seller’s market in a commodity they already hold, often of little intrinsic value, with a view to offloading their investment at an inflated price. Fine wines, coins, paper … .