Quilter chief executive Paul Feeney has written to the prime minister asking for online investment scams to be included in the government’s Online Safety Bill.
In the letter, sent yesterday (April 14), Feeney told prime minister Boris Johnson he is concerned that online search engines and social media platforms are not being held accountable for hosting scam content and advertisements, and that online investment scams need to be included within the scope of the new legislation.
The Online Safety Bill, which is expected to be put forward to parliament this year, is designed to provide a new regulatory framework for online safety.
But Feeney said although this bill was not devised with investment scams in mind, the government should now consider its inclusion.
The letter says the government’s proposals for an online advertising programme, which will include measures to enhance how online advertising is regulated in the UK, will not “provide the urgent change necessary to ensure that online scams are addressed as a priority harm”.
Feeney said: “The Online Advertising Programme will only consider those investment scams facilitated through online adverts, and will not consider the wider ecosystem of investment scams.
“While we recognise that the Online Safety Bill will also have limitations in its remit, it has the potential to capture a much wider variety of scams including those appearing on search engine adverts, those appearing on user generated content online and those appearing on social media platforms.”
Recent figures from Action Fraud showed that £78m was reported to have been lost to clone firm investment scams in 2020, with the average loss in each individual case standing at £45,242.
However, this figure is expected to be higher as many cases will not be reported.
Stephen Timms, chair of the Work and Pensions Committee, raised alarm that the bill in its current form may not address the problem of online scams earlier this year and said he was willing to step in to force change.
He first told FTAdviser in January he intended to table an amendment to the bill during a Fireside Chat interview.
Meanwhile, advisers have already started writing to their MPs, asking them to urge the government to include financial harms in the bill.
Feeney said the bill was a good opportunity to make change in this area.
He said: “The way people search for investment opportunities is changing, with more and more people going online and on social media for tips on where to put their money. But the regulation of the internet isn’t yet fit for the 21st century, and consumers are paying the price.
“Consumers need greater protections from scams, and the government can achieve this by including scams in the Online Safety Bill so that tech companies have a legal responsibility to ensure that their users are not exposed to financial harm.
“Search engines are having their cake and eating it by taking money to host adverts from both the regulator and the scammers themselves. Something has to change to stop this ludicrous situation, and the Online Safety Bill is the ideal time to take decisive action.”