This golden opportunity to act on scams cannot be missed
The government has a lot on its plate at the moment. From the NHS backlog to the Covid recovery and on to the net zero transition, the Prime Minister’s to do list is long and growing by the day.
What opportune timing, then, for a quick win that will be transformational in increasing online protections for all, and that can be achieved with just a simple tweak to draft legislation.
For months now, parliamentary select committees, trade associations, consumer groups, charities, businesses and the regulator have all been asking the government to do exactly the same thing: include adverts and cloned websites in scope of the Online Safety Bill.
This tweak will shift the burden of responsibility away from consumers protecting themselves against scams, and onto the tech companies and social media platforms, who will have a legal responsibility to tackle harmful content online.
But yet the government and the tech companies remain unconvinced.
Google pushed back on regulating online adverts at a recent Treasury Committee session, saying that a tweak to the Online Safety Bill was unnecessary as it wouldn’t be efficient or targeted enough at tackling scam-ads, which they argued were much harder to identify than a rogue post on social media.
Now I wouldn’t disagree. Scam ads are very hard to spot. Which is exactly why scammers love them. They can claim a veneer of legitimacy through the very fact that it is an advert. People trust adverts seen in newspapers or on TV, so why not online?
The fact they are hard to spot is exactly the reason why we need regulations designed to shift responsibility away from the individual and onto the tech companies.
They are the ones with the technology to spot fraudulent adverts in the first place; and they are the ones generating an income from these ads which could be put to good use in finding and eradicating the bad apples.
Google has just introduced a welcome new policy which ensures that only FCA authorised firms – or their approved third parties – will be able to post ads relating to financial services. But this is just on Google. Other platforms don’t have the same policies.
Google told the Treasury Committee that they removed three billion scam ads in 2020, including 123 million that related to financial services. I suspect this is just a drop in the ocean when you consider the amount on other platforms, where no such policy exists.
Without any government attention, this problem, which Andrew Bailey once called the whack-a-mole issue, will never go away. Scammers will simply reappear in other places and the whole scam circus continues once again, but with new techniques and through new platforms.
For the FCA this takes renewed importance. Its latest consumer investment strategy paper outlined its target for a 20% reduction in the number of consumers with high risk tolerance holding over £10k in cash. Where is the first place this cohort of people will go to find investment opportunities? Likely online and on social media.
This is why the Online Safety Bill is so important. It will ensure that, for the first time, tech companies face a legal duty to tackle the harm caused as a result of content on their sites. In other words, they’ll have to ensure that no scams can get through their systems – or face a fine from the regulator.
We are at a crunch point. The committee scrutinising the draft Online Safety Bill are currently taking evidence, and will report by mid-December before the Bill is formally introduced early next year.
If, like us, you have been affected by an online scam – we’d urge you to speak to your local MP and ask them to support efforts to get adverts and cloned websites included in the Bill as well.
This opportunity cannot be missed.
Matt Burton is chief risk officer at Quilter