Ethical Marketing & Sale of Financial Products
Concept
Marketing and sales must give a fair, balanced, accurate picture — **benefits *and* risks, never overstating returns, and always clearly separating guaranteed from non-guaranteed values. Ethical marketing also means safeguarding the client's personal data. The test is not whether each statement is literally true, but whether the overall impression** is fair and not misleading.
Key rules & facts
- Truthful, balanced, not misleading — no exaggeration, no omission of material risks, no cherry-picked or selective performance figures.
- Benefit illustrations: clearly separate guaranteed benefits from non-guaranteed benefits (bonuses/dividends depend on the participating fund's performance); non-guaranteed values are projections, illustrated at prescribed rates (verify: MAS illustration rates, commonly two scenarios).
- Provide the Product Summary / Product Highlights Sheet (PHS) and Benefit Illustration; explain features, fees, and risks (verify: PHS requirement under MAS Notices).
- No pressure selling, false urgency, or implied MAS endorsement — MAS does not endorse products.
- Confidentiality / PDPA: collect only necessary data, obtain consent, use only for the stated purpose, keep it secure, and don't disclose without authority (verify: PDPA obligations).
Ethical marketing do's and don'ts
| Do | Don't |
|---|---|
| Present benefits and risks in balance | Emphasise upside while burying or omitting risks |
| Label projected values clearly as non-guaranteed | Present projected/bonus values as guaranteed |
| Disclose all fees and charges | Hide or downplay costs |
| Use prescribed illustration rates and full scenarios | Cherry-pick a single flattering return figure |
| Give the client time and full information | Use pressure tactics or false urgency |
| Collect only necessary data with consent (PDPA) | Reuse or share client data beyond the stated purpose |
| Let the client draw their own conclusion | Imply MAS endorsement or guaranteed approval |
Exam angle
Judge an advertisement, illustration, or pitch — is it misleading? The classic wrong pattern: projecting non-guaranteed values as guaranteed, or hiding risks/fees. Also expect correct data-handling questions (consent, purpose limitation, security).
⚠ The trap
Treating non-guaranteed (projected) values as promised, and emphasising upside while downplaying risk. Remember: individually-true but one-sided statements are still misleading because the overall impression is unfair.
Takeaway
Tell the whole truth — benefits and risks — and never dress up "maybe" as "guaranteed."
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