The government is planning to consult on measures to tackle online fraud ‘later this year’, admitting the scale of the scam problem is ‘deeply concerning’.
In a written statement, Caroline Dinenage, minister of state for digital and culture, said the government was working with the industry, regulators and consumer groups to tackle fraud, adding that the “growth and scale of online pensions scams, and online fraud more broadly, is deeply concerning”.
As part of this, Dinenage said the government was considering additional legislative and non-legislative solutions to address the harms posed by online fraud in a “cohesive and robust way”.
For example, the Department for Digital and Culture is considering how online advertising is regulated through its online advertising programme.
Dinenage said: “This work will look at ensuring that standards about the placement and content of advertising are effectively applied and enforced online to reduce consumers’ exposure to harmful or misleading advertising.
“This work will look at the role advertising can play in enabling online fraud and help inform our future efforts to tackle it. We will be consulting on this issue later this year.”
The issue of online scams has been raised by the industry many times over the past year.
Earlier this month (April 15), Quilter chief executive Paul Feeney wrote to the prime minister asking for online investment scams to be included in the government’s Online Safety Bill.
Feeney told Boris Johnson he was concerned that online search engines and social media platforms were not being held accountable for hosting scam content and advertisements.
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.
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, the real figure is expected to be higher as many cases will not be reported.
Stephen Timms, chairman 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.
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