In a recent decision, the Alberta Securities Commission (ASC) provided important guidance on the growing influence of social media financial influencers and the potential regulatory pitfalls for investment advisors. The decision, Re Floreani, 2025 ABASC 41, highlights the increasing attention regulators are giving to finfluencers and online content targeted at the investing public.
James Domenic Floreani, a prominent finfluencer operating through a company called Jayconomics, was found by the ASC to have conducted investor relations activities without adequately disclosing that his social media posts promoting certain companies were paid advertisements.
The decision underscores the increasing interest Canadian securities regulators have in enforcing transparency in investor communications, as retail investors increasingly rely on social media platforms and personalities for financial advice.
In the Floreani case, the ASC found multiple breaches of section 103.1(2) of the Alberta Securities Act, which mandates clear and conspicuous disclosure when posts and videos are made on behalf of issuers. Even though some of Floreani’s content did include a disclaimer, the ASC ruled it insufficiently clear. It was hidden from immediate view unless viewers clicked to expand the video’s description box.
The decision follows a similar one by the B.C. Securities Commission in Re Stock Social Inc., 2023 BCSECCOM 52. A marketing firm, working with social media influencers, failed to disclose clearly that social media content promoting several issuers was paid promotional material.
Both cases demonstrate regulators’ increasing scrutiny of finfluencer content, reinforcing the necessity for transparent and upfront disclosures.
Talk to your clients about finfluencers
There are two critical takeaways from these decisions.
First, proactively engage your clients about their exposure to finfluencers and online investment advice.
As highlighted in a recent Ontario Securities Commission (OSC) report, 35% of Canadian retail investors made financial decisions based on finfluencer recommendations. That’s a significant level of influence over investor behaviour.
Advisors should assess their clients’ reliance on such sources and consider employing OSC-suggested mitigation strategies:
- Prebunking misinformation: Pre-emptively debunk false or misleading claims before clients encounter them.
- Inoculation: Present clients with a weaker form of misinformation and refute it, to build resilience against future persuasive messages.
- Education: Explain the need to critically evaluate finfluencer content, to prevent undue reliance on their recommendations.
Second, be careful when creating your own social media content.
When providing educational or promotional content online, ensure that your work doesn’t inadvertently cross into undisclosed investor relations or promotional activities. The Floreani decision clearly demonstrates that investment professionals risk both regulatory and reputational damage if they fail to clearly differentiate educational material from promotional content.
Transparency in online communications is essential. Be vigilant — in your understanding of clients’ online influences and in your own compliance with securities law when posting content online.