UK advertising watchdog Advertising Standards Authority (ASA) has upheld a ruling against Learn to Trade Ltd., which promised riches in ads targeting retail forex traders who attend its educational trading seminars.
Ad description
A Facebook post for Learn to Trade Ltd, seen on November 22, 2016, which stated “Discover how to get your share of the largest and most liquid market in the World. Join us for an educational FREE Forex Seminar Limited seats- Book Now! Learn the Secrets of Successful Professional Trading Learn the power of compounding or how to make £3.5 million over the next 15 years…”.
Issue
The complainant challenged whether the claim “learn how to make £3.5 million over the next 15 years” was misleading and could be substantiated.
Company’s Response
Learn to Trade Ltd stated that 25% of their clients had a starting balance of £20,000 or more in their trading account and they taught their clients to risk only 2% of their account size on any one trade.
They explained that on their basic course, they taught clients how to trade to a level of 4% profit per month on average. They said that when starting with a £20,000 trading account, they assumed a 3% growth per month to allow for a margin of error and worked on the basis that all profits were continually reinvested as per their teaching methods. They explained that this would end the 15 years on £4,090,067 which allowed for a 15% margin of error for potential losses. They stated that they only advertised £3.5 million on the basis that not all trades were taken and to allow for a 15% margin of error. They stated that they believed their education would increase client performance to around 4% per month.
ASA’s Assessment – Complaint Upheld
The ASA considered that consumers would understand the claim “learn how to make £3.5 million over the next 15 years” to mean that through the advice and guidance on investment learned at the free seminar, they would be able to achieve very large sums of money, such as £3.5 million, over a long timescale like 15 years, by trading on the Foreign Exchange Market.
We acknowledged that the advertiser had based their claim on their clients starting with a £20,000 trading account, assuming a 3% growth per month and continually reinvesting their profits. We considered that the omission of this information from the ad, as well as the lack of evidence to show that their teaching methods were proven or successful and had achieved sums such as £3.5 million over 15 years, was misleading and was in breach of the Code.
The ad breached CAP Code rules 3.1 3.3 (Misleading Advertising), 3.7 (Substantiation) and 3.11 (Exaggeration).
ASA Action
The ad must not appear in its current form. We told Learn to Trade Ltd not to repeat the claim “learn how to make £3.5 million over the next 15 years” unless they held robust evidence to show that their teaching methods were proven.