Let’s take on the fraudsters together

The Online Safety Bill presents a golden opportunity to take on the fraudsters. Lloyds Banking Group and Which? set out the case for how the proposed legislation can be strengthened to achieve this aim, making a real difference to people’s lives and finan

Scams and fraud are some of the most prevalent forms of crime in the UK today, and have risen exponentially in the past 18 months as fraudsters exploit the pandemic and people’s increased reliance on digital services in all aspects of their daily lives. Their impact is not just financial, although they do cost victims and the wider economy billions of pounds each year. They can also have a devastating impact on emotional and physical well-being.

That’s why Lloyds Banking Group and

Which? have come together to argue that things have to change. The Draft Online Safety Bill offers just such an opportunity to turn the tide on fraudsters.

The banking industry is already taking steps to prevent fraud, introducing new technology to verify online payments, investing in fraud detection systems and improving consumer awareness. We know there is more the industry must do to strengthen systems and support victims, but equally there is more that must be done to raise standards across the broader economy and protect the public from fraud in the first place.

Online platforms, including the social media companies and search engines that many people use every day, are a big part of the overall solution. Currently they have no legal obligation to protect their users against fake and fraudulent content that leads to scams on their services, and voluntary measures have so far fallen short of the mark. Criminals adopt a variety of methods to exploit these online platforms to engage their victims, offering goods and investments which never materialise once the payment has been made. Fake social media accounts are often used to recruit young people as money ‘mules’ or used to trade stolen card details. The abuse of these online services needs to stop.

In May the Government published the Draft Online Safety Bill, signalling its intention to tackle ruthless criminals who exploit the most vulnerable in our society through online scams. Lloyds and Which? both welcomed this decision, which will help to tackle one source of online scams. But the Draft Bill, as it stands, does not go far enough to tackle the scourge of fraud. It only seeks to address online scams that originate from user-generated online content, such as social media posts. If a fraudster were to post the exact same scam content in a paidfor advertisement on the same online platform, then they would be able to exploit a loophole in the law. How can that be justified?

We know that fraud originating from paid-for online advertisements accounts for a significantly larger proportion of fraudulent activity, both in terms of the number of victims and the amount of their money lost to scammers. The solution is to strengthen the provisions of the Draft Bill in relation to fraud, prioritising online financial scams as an illegal activity, and broadening the scope so that it also tackles paid-for scam content and impersonated websites.

The big companies behind these online platforms have some of the most sophisticated technology in the world. This change in the Draft

Bill will incentivise them to employ their innovation to better vet, remove and block fraudulent online accounts and content, as well as make greater investment in human and automatic review systems. It should lead to the creation of better channels for users and other parties to report scams, for example by cooperating with the payment providers that discover them. There is also a greater role for platforms to improve awareness among their users on how to recognise scams, to encourage users to report fraudulent content and to take more action to report cases to law enforcement.

Ultimately, this will help to prevent the use of online platforms by criminals to steal money from users, but also to prevent their use in recruiting users to participate in criminal activity. The Draft Online Safety Bill provides a golden opportunity to halt a significant source of illegal and harmful content that facilitates online financial scams. It’s one way we can make a real difference. Let’s take on the fraudsters together.