Background
Summary of Council decision:
Four issues were investigated, of which two were Upheld and two Not upheld.
Ad description
A TV ad for Direct Bullion, a gold dealer, seen in August 2017, featured a voice-over that stated, “Have you ever thought about buying gold? Amidst today’s fragile global economy you’re not alone, as many people are returning to this physical commodity as a store of wealth”. Small print on-screen stated, “Prices may fluctuate”. Then, large on-screen text appeared, stating, “29.7% Rise (2016)”. This was accompanied by an animation of a line graph with the line climbing progressively higher against an x-axis labelled “2016” and “2017”. The voice-over continued, “With gold rising by 29.7% last year and averaging 12% for the last fifteen years, we aim to provide a gold standard customer service with a promise to beat any price on gold bars and coins.”
Issue
The complainant challenged whether the following claims were misleading and could be substantiated:
1. “With gold rising by 29.7% last year”;
2. The graph that appeared on-screen; and
3. “Averaging 12% for the last fifteen years”.
4. The ASA challenged whether the ad breached the Code because it implied that an unregulated product could have investment potential and had been broadcast on non-specialist channels.
Response
1., 2. & 3. DB London Ltd (Direct Bullion) said that the claims were based on figures taken from www.goldprice.org, which they understood was the industry standard for gold figures. They attached a graph and table from that website that they believed substantiated the claims.
Clearcast said that they had assessed Direct Bullion’s substantiation, which they considered was sufficient to support the claims.
4. Clearcast said that at the time of submission, they understood the ad to be a collection story. However, in light of the complaint they recognised that some viewers could interpret the ad as implying an investment. As such, they had asked the broadcasters to restrict the ad to specialist financial channels.
Assessment
1. Not upheld
The ad stated “29.7% Rise (2016)” and “With gold rising by 29.7% last year”. The ASA considered that viewers would understand that to mean that the price of gold had risen by 29.7% across the course of the year in 2016, and that the price at the end of the year was 29.7% higher than it had been at the start.
The graph provided by Direct Bullion displayed trends in the price of gold, in pounds sterling, between January 2016 and January 2017. There was a difference of just under 30% in the prices at those two points. We noted that the complainant had provided a chart (from the same source) showing the price in dollars, which increased by approximately 7% during 2016; the percentage change in each currency was different due to fluctuating exchange rates. We considered the evidence demonstrated that the price of gold had increased by 29.7% in pounds sterling during 2016 and therefore concluded that the claims had been substantiated and were not misleading.
On that point, we investigated the ad under BCAP Code rules 3.1 and 3.2 (Misleading advertising), 3.9 (Substantiation), 3.10 (Qualification) and 3.12 (Exaggeration), but did not find it in breach.
2. Upheld
The ad showed a graph with the line representing the price of gold rising continuously. Taking into account how the years were spaced on the x-axis, we considered that consumers would understand it to mean that the graph accurately depicted trends in gold prices over the course of 2016. We acknowledged that the shape of the graph roughly mirrored the trend in gold prices between January 2016 and March 2016. However, it had then been subject to greater fluctuations, which was not depicted. The price had peaked in July 2016, and in order to accurately reflect the trends in gold prices, based on the scale depicted, the line would have to begin to fall. Instead, it continued to rise before fading out. We considered that this was likely to give viewers the impression that the price had risen further over the course of the year than was actually the case. We concluded that the visual exaggerated the extent of the price rise and that the ad was therefore misleading.
On that point, the ad breached BCAP Code rules 3.1 and 3.2 (Misleading advertising), 3.9 (Substantiation), 3.10 (Qualification) and 3.12 (Exaggeration).
3. Not upheld
We considered that consumers would understand the claim “Averaging 12% for the last fifteen years” to mean that was the average rise in gold prices over the past 15 years. The data provided by Direct Bullion indicated that the price in pounds sterling had risen by an average of 12% over this period. It also showed that in all but three years, the price had risen on average rather than fallen. We considered that viewers were likely to understand that prices would fluctuate, particularly over an extended period of time. We considered that the claim had been substantiated and was not misleading.
On that point, we investigated the ad under BCAP Code rules 3.1 and 3.2 (Misleading advertising), 3.9 (Substantiation), 3.10 (Qualification) and 3.12 (Exaggeration), but did not find it in breach.
4. Upheld
We noted that investment directly in gold was not regulated under the Financial Services and Markets Act 2000 and that the ad had appeared on a number of non-specialist TV channels. We noted that the ad referred to gold as "a store of wealth" and focused on the change in the price of the commodity over time. We considered that the ad promoted an investment and that because it was not regulated by FSMA, it should not have been broadcast on a non-specialist channel. We therefore concluded that the ad breached the Code on that point.
On that point, the ad breached BCAP Code rule 14.5.4 (Financial products, services and investments).
Action
The ad must not appear again in the form complained about. We told DB London Ltd to ensure that visuals used in their advertising were not presented in a way that exaggerated the change in the price of gold over time. We also told them to ensure that their future broadcast advertising for investments not regulated or permitted under FSMA appeared on specialised financial channels, stations or programming only.
