The UK must use new laws to ensure online platforms have a legal responsibility to protect users from an “avalanche” of scams, a coalition of groups has warned the Government.
The 17 consumer and business groups and authorities have urged the Government to include scams in its proposed Online Safety Bill – which could be announced in next week’s Queen’s Speech – to protect consumers from their “devastating financial and emotional harm”.
In an open letter to Home Secretary Priti Patel and Digital Secretary Oliver Dowden, the coalition, which includes Which?, City of London Police, the Association of British Insurers (ABI), UK Finance and MoneySavingExpert, wrote: “Online platforms play a pivotal role in enabling criminals to reach and defraud internet users through the hosting, promotion and targeting of fake and fraudulent content on their sites, including adverts that they make significant profits from.
“Yet platforms have very little legal responsibility for protecting their users, despite often being the best placed to tackle harmful content.”
Scams have escalated in the past 12 months, with Action Fraud figures suggesting that £1.7 billion was reportedly lost to them over the period.
Action Fraud estimates that, in the year to June 2020, 85% of all fraud was cyber-enabled.
But the coalition said the actual financial losses are likely to be much higher and do not capture the emotional impact on victims.
The letter read: “Across industry, regulators and consumer groups, there is now wide-ranging consensus on the urgent need for action to tackle scams and the critical role that online platforms must take in protecting users from the harm caused by fake and fraudulent content.
“While we recognise there are initiatives being progressed by the Government designed to tackle aspects of online fraud, there is a growing risk that current plans for future regulatory frameworks are not taking a comprehensive approach to the threats faced by consumers and do not reflect the extent or urgency of the problem.”
Which? chief executive Anabel Hoult said: “The biggest online platforms have some of the most sophisticated technology in the world, yet they are failing to use it to protect scam victims who are suffering devastating financial and emotional harm due to the flood of fake and fraudulent content posted online by criminals.
“The time for self-regulation is over, as clearly it has not worked. The case for including scams in the Online Safety Bill is overwhelming and the Government must take the opportunity to act now.
“Online platforms must be given a legal responsibility to prevent, identify and remove fake and fraudulent content on their sites so that their users are better protected.”
Martin Lewis, founder of the Money and Mental Health Policy Institute and MoneySavingExpert.com, said: “It beggars belief that the Government’s Online Safety Bill could ignore the epidemic of scams that the UK faces – but that’s the plan.
“The policing of scams is critically underfunded, leaving criminals to get away with these frauds with impunity.
“The Government has a chance to at least deny them the ‘oxygen of publicity’ by making big tech responsible for the scammers adverts it is paid to publish.
“I plead on bended knee for the Government to take that opportunity, by putting scams in the Online Safety Bill. Failing to do so will betray its promise to create world-leading online protection and will leave vulnerable people defenceless against online crime in the midst of a global pandemic.”
David Postings, chief executive at UK Finance, said: “The banking and finance industry is tackling fraud on all fronts, but we can’t do it alone. We need other industries, including the online platforms exploited by criminals, to join the fight and take responsibility for criminal activity that is happening on their doorstep.
“It’s not right that online giants are effectively profiting twice – once from criminals marketing scams on their platforms and again from organisations having to advertise fraud warnings to consumers.
“We are strongly calling on the Government to take a major step forward by including economic crime in the upcoming Online Safety Bill and helping ensure tech giants take responsibility for their part in protecting consumers from the scourge of online fraud.”
A Government spokesman said: “The Government is working closely with industry, regulators, law enforcement and consumer groups to tackle online fraud.
“This includes our Online Advertising Programme, which will consider further regulation relating to online advertising to reduce online harms, recruiting more police with specialist skills as part of our commitment to recruit 20,000 new officers, and providing scam reporting and takedown services which to remove malicious or fraudulent websites.”
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