Malaysian Financial Bomoh Guideline

Their videos promise financial freedom in minutes, their advice often shared more widely than that of licensed experts and, in some cases, heavily influences how Malaysians manage their money.

These financial influencers or “finfluencers” — online personalities who turn complex financial topics into trending reels — have long dispensed money tips, investment opinions and “wealth hacks” across social media without the guardrails that govern licensed professionals, until now.

In response to the growing presence of financial influencers and the widespread use of technology, a new guideline governing governing advertisements for capital market products and related services took effect on November 1.

First issued by the Securities Commission Malaysia (SC) in 2020, the revised guideline is meant to level the playing field — ensuring that finfluencers who share investment advice are held to the same standards as those licensed under securities laws.

Malaysian Financial Planning Council (MFPC) International Development Committee chairman Anuar Shuib said many so-called financial “gurus” had been sharing potentially unreliable and unsubstantiated information with consumers before the guideline came into force.

Under the guideline, finfluencers are regarded as voluntary advertisers and are prohibited from promoting capital market products and related services, including financial planning, unless they are licensed by the SC.

Failure to obtain a licence or registration from the SC is a punishable offence under the law and one can be fined up to RM10 million or jailed for up to 10 years or both.

While consumers remain free to choose the content they wish to follow, Anuar stressed that it is essential to verify whether a finfluencer is authorised by the SC before acting on any personal finance advice.

The guideline clarifies that it does not cover the dissemination of factual information about a capital market product for educational purposes, as long as the information is not intended, and is unlikely, to influence anyone to act on or take a position in relation to that product.

Among others, the guideline also requires an advertisement to be presented in a manner that allows consumers to immediately identify it as an advertisement.