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Calls to include scam ads in online safety bill and tighten rules

UK parliament
The online safety bill is due to be put to parliament for approval in 2022. Photo: Getty (IR_Stone via Getty Images)

MPs have called for an overhaul of the UK's online safety bill, including specific changes to tackle online fraud.

The bill is currently being drafted and is due to be put to parliament for approval in 2022 but critics have said that there are a problems with the legislation as it does not currently cover paid online adverts.

The new law will "make internet service providers responsible for what’s happening on their platforms, including for serious crimes like child abuse, fraud, racist abuse, promoting self harm and also against violence against women, for which previously there was little enforceable sanction," according to the government.

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In a meeting of the Joint Committee on the draft of the new law, there were calls for paid adverts to be covered by the bill, to stop fraudsters from using the adverts to attract their victims.

Evidence put to the committee included attestations that victims of fraud lost £2.3bn over the past year alone, and 85% of scams rely on the internet.

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Paid adverts are not currently designated as "priority illegal content" and is not "specifically mentioned in the way other risks are", according to Sarah Coles, senior personal finance analyst, Hargreaves Lansdown.

"It means providers only have a duty to remove fraud when it’s reported by users. And there’s a risk that it’s only likely to be reported by users when they have fallen victim," she said.

"The Competition and Markets Authority warned that at the moment legislation means that providers have to take proactive steps to minimise the risk from content designed to damage people’s finances, so the new legislation could actually undermine existing rules, and weaken protections.

"The committee called for it to be designated as a priority, so providers would have to control the risk of content appearing on the site. They also want fraud to be specifically mentioned alongside other risks, so the bill itself rather than secondary legislation would require platforms to proactively stop fraud from appearing."

Mel Stride MP, chair of the Treasury Committee, said: “The Treasury Committee has repeatedly called for the government to include fraudulent advertisements within the scope of the online safety bill. While it’s reassuring that some online platforms are taking action to remove scam adverts from their sites, it’s clear that not enough is currently being done to combat online fraud.

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“We support the Joint Committee’s recommendations in this area and call on the government to act and stop these criminals in their tracks. Without a decisive response from the government and the tech giants, many more individuals will sadly fall victim to these scammers.”

Rocio Concha, Which? director of policy and advocacy, said: “If the government is serious about cracking down on the epidemic of fraud, it must act on these recommendations and use the online safety bill to finally require online platforms to take responsibility and prevent fraudulent paid-for adverts appearing on their sites.”

Insurance companies also warned the committee that criminals can make copies of providers’ websites and pay for the fraudulent copies to appear at the top of search results.

Martin Lewis, founder of Money Saving Expert and the Money and Mental Health Policy Institute, discussed the danger of investment scams, which promote fake investment opportunities promising high returns.

The committee also heard evidence of scams where fraudsters create fake accounts on dating sites and develop relationships with victims in order to steal their money. Almost 9,000 people were affected by this in 2020, losing £21.2m — up 17% in a year.

The committee also concluded that regulatory authority Ofcom should create mandatory codes of practice for internet service providers including codes of conduct on risk areas such as child exploitation and terrorism.

Service providers should also have to conduct internal risk assessments to record foreseeable threats to user safety, including the potential harmful impact of algorithms, not just content.

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The bill also aims to protect for freedom of expression by automatically exempting recognised news publishers, and acknowledging that journalism and public interest speech are "fundamental to democracy".

The committee also recommended that the bill should be clearer about what is specifically illegal online and that government rather than tech companies should decide this.

They want cyberflashing — the sending of obscene pictures to strangers — to become illegal, as well as content or activity promoting self-harm and deliberately sending flashing images to people with photosensitive epilepsy with the intention of inducing a seizure.

Myron Jobson, personal finance campaigner at Interactive Investor, said: “The online safety bill in itself won’t plug the flood of financial scams that have mushroomed during the pandemic or offer complete protection against harmful content that can not only result in emotional and psychological harm, but financial peril as well. The onus still falls on individuals to avoid financial harm — there is no getting around it.

“Online searches are a great way of getting financial guidance and ideas, but it can be a minefield. The internet is a rich trolling ground for unscrupulous individuals to convince unsuspecting victims to part with their hard-earned money. Fraudsters are only too willing to exploit any ignorance or naivety.

Jobson pointed to the rise of social media and online "influencers" which "has seen rise of so-called ‘financial influencers’ — some of whom haven’t got a clue on what they are talking about to put it bluntly. It’s important to check the credentials and quality of your sources."

Watch: How do influencers make money from Instagram?