The International Organization of Securities Commissions has published its Final Reports on Finfluencers, Online Imitative Trading Practices, and Digital Engagement Practices. These reports form the third wave of IOSCO’s Roadmap for Retail Investor Online Safety, a global initiative launched in November 2024 to confront emerging risks in digital retail investing and strengthen coordinated international oversight.
The reports focus on three intersecting trends: social media influencers providing financial content, automated imitative trading platforms, and engagement practices by financial firms that use gamification and behavioral design. IOSCO says these developments have increased accessibility to investing while also heightening the risk of fraud, misinformation, and misaligned incentives for retail investors.
Confronting emerging risks in digital retail investing
Jean-Paul Servais, IOSCO Board Chairman and Chair of Belgium’s Financial Services and Markets Authority, commented, “The publication of these Final Reports marks a significant milestone in IOSCO’s mission to safeguard retail investors in a rapidly digitalising world. From finfluencer promotions to gamified apps and imitative content, these reports set out globally aligned expectations for ethical conduct and effective oversight. They reflect our commitment to fostering innovation that serves the public interest, ensuring that technology enhances trust, rather than undermining it, in financial markets.”
The Finfluencers Report examines the growing role of unregistered individuals and online personalities who influence investment behavior. IOSCO highlights regulatory challenges in distinguishing between personal opinion and investment advice, especially where influencers may not hold the credentials required by law. The report outlines a series of Good Practices for regulators, platforms, and influencers to promote transparency, accountability, and clearer boundaries between general content and regulated advice.
The Online Imitative Trading Practices Report covers practices such as copy trading, mirror trading, and social trading. IOSCO points to investor harm stemming from the automated replication of trades without sufficient understanding of the risks involved. The report warns that many retail investors may follow high-risk strategies without realizing the potential losses or misalignment with their financial goals. It encourages regulators to focus on investor education and disclosures to address these concerns.
The Digital Engagement Practices Report analyzes how investment platforms use gamified design, push notifications, and other engagement tools to influence user behavior. The report calls attention to potential conflicts of interest when these tools prioritize trading activity that benefits intermediaries over the interests of investors. IOSCO recommends clear standards for the use of DEPs, including transparency in messaging and robust disclosures about how these features affect investor decision-making.
Derville Rowland, Chair of IOSCO’s Retail Investor Coordination Group, commented, “The digital transformation of financial markets has reshaped the way retail investors interact with financial products and services. The Good Practices outlined in the three reports provide IOSCO members with a framework to address the challenges while maintaining the benefits of innovation.”
All three reports include targeted Good Practices that member jurisdictions can use to strengthen regulatory frameworks, improve investor outcomes, and align national approaches with IOSCO’s global standards. The recommendations aim to balance support for innovation with safeguards that protect investors from undue risk or misconduct in the digital environment.
This latest set of publications follows earlier work in IOSCO’s five-wave Roadmap strategy. Future waves are expected to address supervisory implementation, enforcement approaches, and broader regulatory cooperation in response to the digital evolution of retail investing.
