Fake Financial News is a Real Threat to Majority of Americans: New AICPA Survey

1-in-3 Say Fake Financial News is a Serious Threat to Their
Decision Making

NEW YORK–(BUSINESS WIRE)–Fake news, deliberately false and misleading articles, has been all over
the news lately. A new survey reveals that fake financial news has the
potential to be a real serious problem, and it’s impacting Americans’
ability to make retirement, investment and healthcare decisions. These
often completely made up stories are presented to consumers in many
forms, such as sponsored content or fake websites meant to mirror the
look and feel of credible news sites. Even worse, a majority of
Americans say they feel that fake news is going to become even more
prevalent in the future.

The risk of making an impulsive financial decision in reaction to a
headline or article that may be designed to mislead has the potential to
cause serious problems. Acting hastily does not allow the proper time to
think a decision through and weigh the long and short-term financial
implications. However, more than 3-in-4 (77 percent) Americans feel it’s
important to act fast to make financial decisions when breaking
financial news becomes available, with 40 percent saying it’s very
important to act quickly. That’s according to a new telephone survey of
1,018 adults conducted in March 2017 for the American Institute of CPAs
(AICPA) by Harris Poll in support of National Financial Capability Month.

“Having accurate, reliable financial information is the basis for
deliberate and rational decision making,” said Greg Anton, CPA, CGMA,
and chair of the AICPA’s National CPA Financial Literacy Commission.
“With few exceptions, making snap financial decisions is usually not a
good idea. There is a fine line between reacting and overreacting, and
Americans should proceed cautiously until they’re able to parse the
facts.”

There is widespread awareness about the issue of fake financial news.
Almost 3-in-5 Americans (58 percent) believe that fake news is a serious
threat to their financial decision making, with more than half of those
(33 percent) saying the threat is very serious. Those sentiments are
consistent for both genders, among household incomes and across
generations.

However, fake news is not just an abstract threat – it’s having a
serious impact on Americans’ ability to navigate their financial lives.
More than 3-in-5 Americans (63 percent) say that the spread of fake news
has made it more difficult to make critical financial decisions.
Specifically, they’re having a harder time with healthcare decisions (44
percent), investing in the stock market (40 percent), retiring (36
percent) and buying or selling a house (35 percent). Additionally, 35
percent reported having trouble deciding if they should start a business
and 29 percent said it was harder to decide if they should switch jobs.

“Financial decisions around healthcare, investments and retirement can
have serious, long-term implications. It can be difficult enough to
understand the financial impact of proposed changes in laws and
regulations without having to deal with a sea of disinformation,” added
Anton. “Social media can serve to amplify the impact of fake news,
particularly when many people are sharing articles that come to the same
conclusion. It’s more important than ever to verify sources, check the
facts and if you’re still not sure, speak to someone you trust before
making any financial decisions.”

Unfortunately, most Americans don’t think the problem of fake financial
news will be resolved in the near future. Only 14 percent say they
expect fake financial news to become less prevalent in the next year or
two, with 32 percent saying it will stay about the same. Whereas a
majority of all Americans (51 percent) expect fake news and misleading
headlines to get more prevalent, with more than half of those (30
percent) saying that it’s going to get much more common.

Fake news is nothing new, but increased awareness of the threat it
places on financial decision-making can help keep Americans from being
lured into making decisions that will hurt them financially. To help
Americans navigate the sea of information and misinformation out there,
the AICPA National CPA Financial Literacy Commission offers the
following tips:

  • Before hastily making an investment decision based on an article or
    headline, do
    your due diligence
    . Quickly reacting to market-moving news, real
    or fake, can be tempting but most investment plans are designed for
    the long term. If you have a pressing financial question, ask
    the Money Doctors
    – a panel of qualified CPAs that have attained
    the Personal Financial Specialists (PFS) credential for comprehensive
    financial planning.
  • Be suspicious of headlines making outrageous claims and articles with
    incorrect grammar and multiple typos. Always research the source if
    you’re unfamiliar with the outlet and read some of their other
    articles. Look into the author and their sources to confirm that they
    are authentic. Inadequate evidence or extensive use of unnamed experts
    may suggest a false news story. Always corroborate the story with
    other reports.
  • Watch out for website spoofing – the practice of impersonating
    legitimate websites and posting content that appears as though it is
    from that site. Fake financial news articles published on these
    websites have the appearance of being from a credible source, but are
    actually designed to mislead readers.
  • Closely scrutinize sponsored content and advertorials. These articles
    are often designed to look like reported content to sell products, but
    are actually outside of a news organization’s editorial content.
  • Look out for pranks. Fake news can sometimes be hard to tell apart
    from humor or satire and many people can be misled. Check to see if
    the source is known for parody and the article is a joke –
    particularly if you see it shared on social media rather than on the
    source website.

About AICPA Financial Literacy Initiatives

360 Degrees of Financial literacy (www.360finlit.org),
is a national volunteer effort of the nation’s CPAs to help Americans
understand their personal finances and develop money management skills.
The AICPA, in partnership with the Ad Council, has also developed Feed
the Pig
, a national and localized PSA campaign designed to improve
financial literacy among Americans aged 25–34 by encouraging them to
make savings a part of their daily lives. Both programs are free to the
public.

Survey Methodology

This Harris Poll was conducted by telephone within the United States
between March 24 and 27, 2017, among 1,018 adults (505 men and 513 women
aged 18 and over) including 518 interviews from the landline sample and
500 interviews from the cell phone sample. 650 adults self-identified as
“non-retired” and 322 as “retired”. Figures for age, sex,
race/ethnicity, education, region and household income were weighted
(using data from the Current Population Survey) where necessary to bring
them into line with their actual proportions in the population.

About the American Institute of CPAs

The American Institute of CPAs (AICPA) is the world’s largest member
association representing the CPA profession, with more than 418,000
members in 143 countries, and a history of serving the public interest
since 1887. AICPA members represent many areas of practice, including
business and industry, public practice, government, education and
consulting. The AICPA sets ethical standards for the profession and U.S.
auditing standards for private companies, nonprofit organizations,
federal, state and local governments. It develops and grades the Uniform
CPA Examination, offers specialized credentials, builds the pipeline of
future talent and drives professional competency development to advance
the vitality, relevance and quality of the profession.

The AICPA maintains offices in New York, Washington, DC, Durham, NC, and
Ewing, NJ.

About the Association of International Certified Professional
Accountants

The Association of International Certified Professional Accountants (the
Association) combines the strengths of the American Institute of CPAs
(AICPA) and The Chartered Institute of Management Accountants (CIMA) to
power opportunity, trust and prosperity for people, businesses and
economies worldwide. It represents 650,000 members and students in
public and management accounting and advocates for the public interest
and business sustainability on current and emerging issues. With broad
reach, rigor and resources, the Association advances the reputation,
employability and quality of CPAs, CGMAs and accounting and finance
professionals globally.

Contacts

American Institute of CPAs
James Schiavone, 212-596-6119
James.Schiavone@aicpa-cima.com
or
Jonathan
Lynch, 212-596-6033

Jonathan.Lynch@aicpa-cima.com