Katie Price was slated by fans for promoting a “scam” after she encouraged them to invest money in an unauthorised Forex trader on Instagram.
The reality star gave an enthusiastic endorsement to the Instagram page XChloesWorld, which boasts of being an easy and quick way to make money.
After being contacted by The Mirror, financial authorities issued a new updated consumer warning and asked that the unauthorised online trader be removed.
Katie claimed she was unaware of prior warnings from the financial authorities.
Her rep told the Mirror: “Katie would never knowingly be involved with any scams and wants no further association with such companies.”
She added that more legislation was needed.
The rep said: “Katie will make a stand to stamp them out. Legalisation is needed to protect customers and those unknowingly engaged in promoting what appears to be a legitimate brand.”
In her post Katie told fans: “There’s so much money to be made in the markets” and reassured them that the one she was promoting, XChloesWorld, “is trusted In the trading market”.
The Instagram profile Katie linked to is covered in glossy pictures of a brunette living it up, interspersed with messages from clients talking about how much money they have made.
The Financial Conduct Authority has warned repeatedly about unauthorised Forex traders using flashy social media profiles to make followers think they can trade online and quickly make thousands.
Forex traders speculate whether one currency’s value, like the pound sterling, will go up or down in relation to another, such as the US dollar.
However, if investors use an unauthorised firm they won’t have access to the Financial Ombudsman Service or Financial Services Compensation Scheme (FSCS), so are unlikely to get their money back if things go wrong.
Katie wrote on her Instagram that her 2.3million followers might find it “hard to differentiate the bad guys from the good.”
After being contacted by The Mirror, the FCA stated on it’s website: “On Tuesday 12 January we updated our consumer warning against an unauthorised online trader using Instagram, known as chloefxtrades / chloehenx, to include a further account xchloesworld.
“This account has been promoted widely on social media and we want consumers to be aware that it is not authorised by us. We have requested that the account should be removed.”
Katie’s fans were quick to question whether she had fully researched her post, which she removed after being contacted by The Mirror.
While Katie had turned off comments on the post, they rook to her previous Instagram image to ask: “Is the reason you’ve turned comments off on your latest post because it’s a scam?”
Another follower wrote: “Reported the forex scam, you never learn.”
And a third cautioned: “You’ve turned comments off, regarding the scam? Online traders promise very lucrative guaranteed returns which tend to stop after victims have invested money and got their first round of profits.”