Websites warned over share tipping

Financial websites are falling foul of the FSA

The UK's financial services regulator has warned websites to stop republishing newspaper share tips.

The Financial Services Authority said it had told "a number" of websites that it was illegal to publish the tips unless the sites were registered as financial advisers.

Sharepages.com, a site specialising in financial services and markets information, said it had had to suspend publishing its round-up of weekend newspaper tips because of compliance issues with the FSA.

"This is due to the fact that the FSA consider weekend paper tip summaries as investment advice, which is not permissible in an unregulated environment," a notice on the company's website said.

A FSA spokeswoman said it was handling the matter on a case-by-case basis and that its advice depended on precisely what information was being provided.

"It all boils down to consumer protection," the spokeswoman said.

Earlier in the year, the FSA warned people about following tips published on the internet, especially in chatrooms, as they were likely to be misleading.

Newspaper exemption

Newspapers, financial periodicals and their associated websites are not subject to the restrictions because investment business is not considered to be their main purpose.

Instead of republishing tips, some websites are now only naming stocks and providing links to the newspapers' web pages.

Sharepages.com said it was in continuing talks with the FSA.

It denied the newspaper tips constituted investment advice, saying the information was already in the public domain.

The FSA said its actions were aimed at "policing the perimeter" of the Financial Services Act and that internet companies were not being singled out for investigation.

The existing legislation, which exempted newspapers, was drawn up in the 1980s and did not take financial websites into account.

The FSA said it was in discussions with the Treasury about a new Financial Services and Markets Act that was due to come into force next July.