Rob Lee, Director of Fraud Prevention at Aviva, said: “The news today that pre-paid fraudulent advertising will now be within scope of the Online Safety Bill comes as a welcome relief to all those who have campaigned so hard to help protect consumers from online fraud. We have seen first-hand the often devastating impact fraud has on the financial and mental wellbeing of victims.
“We will of course need to examine the detail of the Bill when it is presented to Parliament for further scrutiny, to ensure that consumers are adequately protected at every stage of their online journey, but this milestone represents a significant shift in the right direction.
“The legislation needs to tackle the problem of financial scams and misleading financial promotions. Our concern is centred on the sharp practices employed by fraudsters, which mislead consumers and put them at serious risk of financial harm.”
The Aviva Fraud Report - which was published in August and investigates fraud and financial scams relating to pensions, savings, investments, and insurance – found consumers have low trust in the internet as a tool for shopping for financial services2.
Rob Lee said: “There is a clear mistrust of financial services adverts online. However, there is no legal responsibility for technology firms to verify the legitimacy of the companies which pay them to publish adverts on their platforms. This potentially leaves millions of internet users exposed to unscrupulous adverts.”
Consumers are clear that more needs to be done to protect them from financial harm online. Almost nine in ten people surveyed (87%) think government should legislate to ensure search engines and social media sites do not mislead consumers or promote financial scams. And 85% of people think search engines should be responsible for advertising content on their platforms so that it is not misleading.
More than half of internet users (53%) don’t trust that the adverts on search engines are placed by a legitimate financial services company or provider. And more than half (56%) don’t believe that search engines verify the authenticity of the financial product, service, or provider that they allow to be advertised on their platform.
Liz Field, Chief Executive of PIMFA, comments: “When the Government first published its White Paper on the Online Safety Bill many who work in financial services, consumer groups and charities were dismayed to discover that financial harm was not among the harms the new Bill would deal with.
“As a result, PIMFA, UK Finance, Which? The Money and Mental Health Policy Institute and many other organisations formed a campaign group to lobby the Government to include fraudulent online adverts and user-generated content, which cause untold financial and mental distress to thousands upon thousands of victims each year, within the scoppe of the Online Safety Bill.
“In May, the Government conceded our point about user-generated content and included such content within the scope of the Online Safety Bill. Today, it has once again accepted our argument, and that of the Financial Conduct Authority, Financial Services Compensation Scheme, Bank of England, and the Treasury Select Committee among a host of MPs and others, that paid-for online adverts be included within the scope of the Bill.
“Of course, we will wait to see the detail in the Bill. But we are delighted to see the Government has seen sense and is willing to act to save thousands of people from the threat of fraud, which is after all, the widest reported crime in the UK today.”
Kate Smith, Head of Pensions at Aegon, comments on the inclusion of paid for adverts in the Online Safety Bill: “The pension industry spoke with one voice campaigning for inclusion of fraudulent paid for adverts, in addition to user-generated content, to be included in the Online Safety Bill. We’re therefore absolutely delighted that the government has listened to our concerns and will cover scams originating from all sources. Exclusion of paid-for adverts would merely have led to scammers taking advantage of this loophole. Scams are constantly evolving and it’s important that legislation moves with the times, providing greater protection to protect people’s hard-earned cash, investments and pensions.”
Yvonne Collins, Head of Financial Crime Prevention at Phoenix Group, comments on the inclusion of internet scams in the Online Safety Bill: “This is a momentous move from the Government, responding to the urgent need to crack down on fraudulent online advertising. By including measures to address this in the Online Safety Bill, internet users will be better protected and laws regulating online activity will be in line with existing practices in the wider world. The onus is now on social media platforms and search engines to be more vigilant against fraudulent activity on their services, including unlicensed financial promotions and fake ads.
“As platforms and search engines step up and put proportionate systems and processes in place, consumers must continue to be wary of suspicious online activity. Fraudsters look to target those who are vulnerable, and with the cost of living escalating and global uncertainty, they will see this as an opportunity to strike. Popular scam techniques to watch out for during uncertain periods include using market volatility around stock markets to encourage you to transfer or review your finances, promoting investment opportunities with guaranteed returns, offering to unlock cash held in pensions, and fake online resources that deliver malware that can infiltrate sensitive data. Always take a moment to stop and think before parting with your money or personal information and don’t be afraid of rejecting, refusing or ignoring any requests you receive – only fraudsters will try to rush or panic you, whereas a legitimate company will answer further questions or provide additional information to answer any concerns.”
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