The Securities and Exchange Commission (SEC) has issued a strong warning to social media influencers and bloggers, cautioning them against promoting unregistered investment schemes. The regulatory body emphasized that individuals who endorse or advertise such platforms could be held legally accountable, even if they are not directly involved in managing the schemes.
According to the SEC, many influencers unknowingly or negligently contribute to the spread of fraudulent schemes by sharing investment links, promotional content, or testimonials that are not backed by licensed financial entities. These promotions often lure unsuspecting followers into losing money through fake or illegal platforms, especially via social media.
“Influencers have a responsibility to verify the legitimacy of any financial product or service they endorse,” the Commission stated, adding that failure to do so may lead to regulatory sanctions or prosecution. The warning comes amid a rise in online investment fraud cases targeting young and tech-savvy demographics through platforms like Instagram, TikTok, and YouTube.
The SEC also reminded the public to verify the registration status of any investment company through official regulatory channels before committing funds. It advised citizens to be skeptical of schemes that promise high returns with little or no risk, as these are common red flags of Ponzi or pyramid operations.
With the growing influence of digital media personalities, the SEC’s warning serves as a broader call for ethical responsibility in the financial promotion space. The agency is also working with law enforcement to monitor suspicious activities online and has urged the public to report influencers promoting questionable investment opportunities.
