Strengthening Financial Promotion Approval Evidence and Controls

At a Glance

At a Glance: The FCA's review of financial promotion approvers highlights the need for stronger evidence, audience controls, and substantiation of claims in approved promotions.

The FCA's review of financial-promotion approvers found examples of unsubstantiated claims, retail investors seeing promotions intended for professional clients and firms relying on third-party templates without proper checks. The FCA says every promotion signed off must be fair, clear and not misleading.

For an approver, those findings translate into three separate evidence tests: whether material claims are substantiated, whether the intended audience and access controls work, and whether the firm performed its own review rather than relying on a template provider.

Who This Guide Is For

The FCA reviewed 10 authorised firms that approve financial promotions for businesses not authorised by the FCA. Its sample included promotions for Buy Now Pay Later, crowdfunding and corporate-finance firms; the source does not label those sampled areas as high risk.

This guide is therefore aimed at Section 21 approvers, their approval committees and compliance teams. The FCA's findings provide three focused review prompts: substantiation of claims, control of audience access and independent checking of third-party templates.

The Decision Firms Need to Make

Substantiating claims in financial promotions

The FCA's review found that some firms approved promotions with unsubstantiated claims, lacking evidence to support material statements. Firms should ensure that every claim in a promotion is backed by verified data or documentation, aligning with the fair, clear, and not misleading standard.

Audience controls for promotions

The approval file should identify the intended audience and retain a test of the controls used to restrict access. Where material is intended for professional clients, the test should show whether a retail user can still reach it through the live journey.

Third-party template reliance

The review highlighted over-reliance on third-party templates without proper checks. Firms should conduct independent reviews of all promotion materials, even when using templates, to ensure accuracy and compliance with regulatory standards.

MEMA Practical View

MEMA's view is that an approval committee should be able to reconstruct the decision from the file: which claims were material, what evidence supported them, who the promotion was for, how access was tested and what changed after challenge. The record should also identify the approved version and retain the final rationale so a later reviewer can distinguish evidence considered before sign-off from monitoring performed after launch.

The FCA says the strongest firms applied the Consumer Duty from the start and checked that promotions were accurate, clear and reached the right audience. Governance reporting should therefore separate claim-substantiation, audience-control and template-review exceptions so repeat weaknesses are visible rather than hidden inside approval volumes.

The approval committee should be able to reconstruct why the promotion was approved: which claims were material, what evidence substantiated them, which audience was intended and how access restrictions were tested.

How to Prepare

Evidence to Prepare

MEMA recommends structuring the approval record around the promotion version, material claims, substantiating evidence, intended audience, access-control test, challenge raised and final decision. That creates a usable audit trail without presenting MEMA's suggested record design as FCA-prescribed fields.

Testing should include a live user journey after launch or a distribution change, because an approval record cannot show that an access restriction works in practice. Exceptions should return to the relevant owner with the wording or distribution change and the result of the retest.

Design the approval file around three separate tests: substantiation of material claims, suitability of the intended audience and independent review of any third-party template. The approver should retain the evidence reviewed, challenge raised and wording or distribution changes made before sign-off. Access controls should be tested from the user's perspective, including whether retail users can reach material intended for professional clients. Anchor the procedure to Review of financial promotion approvers finds some firms need to raise standards and the rules applicable to the promotion concerned.

Source Evidence

Disclaimer

This article is for general information only and does not constitute legal or regulatory advice. Firms should assess the application of regulatory requirements by reference to their permissions, products, customers and operating model.

How MEMA Can Help

MEMA can help firms translate regulatory change into practical controls, policies, monitoring activity and board evidence. Book a free scoping call to discuss what this development means for your firm.

MEMA's financial promotions compliance tool supports claim substantiation, audience and approval-record checks.

Further reading: financial-promotion approval controls.