Malaysia’s New SC Advertising Rules: RM10 Million Fine or 10 Years Jail for Promoting Unlicensed Brokers

Malaysia’s New SC Advertising Rules: RM10 Million Fine or 10 Years Jail for Promoting Unlicensed Brokers

By Zitadelle AG – 15 August 2025

The Securities Commission Malaysia (SC) has introduced strict new advertising rules that will significantly change how brokers, financial institutions, and promoters market capital market products in Malaysia.

Starting 1 November 2025, anyone promoting a broker that is not licensed in Malaysia—including IBs, affiliates, and even individuals sharing referral links—could face up to RM10 million in fines or up to 10 years’ imprisonment, or both.

Key Details of the Revised SC Guidelines

On 27 March 2025, the SC issued updated Guidelines on Advertising for Capital Market Products and Related Services, replacing the 2020 edition. The revisions address the rapid growth of social media marketing and the rise of financial influencers (“finfluencers”) in the Malaysian market.

1. Finfluencers are Now "Advertisers"

Even if a finfluencer is not officially hired by a broker or financial institution, any independent promotion of a capital market product qualifies them as an “advertiser”.
This means they must comply with the same advertising standards and disclosure rules as licensed market participants.

2. Advertisers Are Responsible for Agents

Licensed brokers, fund managers, and other advertisers will be held liable for any marketing breaches by their affiliates, IBs, or third-party marketers.

3. Enhanced Rules for Social Media

Promotions must be clear, balanced, and not misleading.
Content should include risk disclosures, avoid exaggerated claims, and follow SC-approved guidelines.

4. Ban on Unauthorised Advertising

Parties not authorised by the SC are prohibited from advertising capital market services in Malaysia—whether via websites, email campaigns, or social media posts.

Who This Affects

The new rules apply to a wide range of market participants, including:

Financial institutions – banks, licensed brokers, asset managers, and fund managers.
Brokers & IBs – both domestic and foreign.
Financial influencers – content creators on YouTube, Instagram, TikTok, and Facebook.
Affiliates & marketers – anyone generating leads or referrals for financial products.

What You Need to Do Before 1 November 2025

Verify Your Licensing Status
Only SC-authorised entities may advertise capital market services in Malaysia.
Audit Your Marketing Content
Ensure all campaigns meet SC’s updated guidelines, including balanced risk/reward representation.
Supervise Third-Party Promoters
Maintain oversight of affiliates, IBs, and social media partners to ensure compliance.
Train Your Team
Educate marketing staff and partners on the legal risks of promoting unlicensed services.

Why This Matters

For most foreign brokers, obtaining an SC license can be costly and resource-intensive. The Malaysian market’s size, compliance requirements, and licensing process may make it impractical for some. As a result, many IBs and affiliates will need to pivot their business models—possibly towards:

Licensed local brokers
Proprietary trading firms
Financial education services

Zitadelle AG Can Help

At Zitadelle AG, we specialise in regulatory compliance and licensing support for brokers, fintech firms, and financial service providers across Asia, Europe, and offshore jurisdictions.

If you are currently promoting in Malaysia—or planning to—our team can help you: