On 24 March 2020, the MFSA issued a circular providing information to the general public on consumer protection measures being taken by the Authority in relation to COVID-19. The MFSA re-assured consumers that it is closely monitoring and engaging with regulated entities to understand any potential impact of COVID-19 on the entities' business and their clients. The MFSA stressed the importance of the paramount principle, which is applied across all financial services practice areas, of 'always treating customers fairly.'
The MFSA appealed for caution when deciding on whether to invest, buy or sell an investment during these unprecedented times. Information circulated to potential investors by MFSA regulated entities may quickly become outdated, especially if it contains forecasts. Up to date financial information on the issuers may not necessarily be available given that various reporting deadlines have been extended in the light of the current circumstances. Consumers should treat investment communications promoting investments based on medical/scientific solutions to the crisis (such as cures or vaccines) with extreme caution. Investors should always consult a licensed financial intermediary before investing.
If the investment communication contains phrases such as "you will benefit from a sum of money very easily", "you have to give away personal or account information" and/or "you will have to make a quick decision" then it is highly likely that you are being targeted by a financial scam or a fraudulent scheme.
Consumers should: (i) steer away from investment adverts on social media and paid for/sponsored adverts online, (ii) avoid clicking on links or opening emails from senders not already known; and (iii) avoid disclosing personal details.
The MFSA advises consumers to immediately reach out to the Authority, if they think that they might be dealing with an unauthorised entity or financial scammers.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
