The Personal Investment Management and Financial Advice Association, the Investment Association, Which?, UK Finance, Martin Lewis and MoneySavingExpert, among others, warned the government in a statement published yesterday (July 21), that its approach to tackling online fraud was “flawed”.
In May, the government announced measures to tackle some online scams in the bill but stopped short of including fraud via advertising, emails or cloned websites.
Instead, it said, online advertising would be dealt with through a separate review of advertising regulations which is in its infancy.
The industry coalition said: “[The government's approach] will likely lead to complex and muddled regulations, and far worse consumer outcomes than an Online Safety bill with a comprehensive approach to online fraud.
“While we welcome the recent inclusion in the bill of fraud carried out through user generated content and fake profiles on social media websites, there is still a long way to go. Failing to include online advertising in the bill leaves too much room for criminals to exploit online systems.”
The group said this view was backed by the Financial Conduct Authority, Bank of England, City of London Police and Work and Pensions committee and Treasury committee, who have all commented that the scope of the Online Safety bill should be expanded to include fraud carried out via online advertising.
It added: “We do agree with the government that the impact of these frauds is often devastating, not just financially but also emotionally. That’s why we urge ministers to reconsider their current plan, and make sure the bill protects as many consumers as possible from the full extent of the devastation caused by scams.”
It comes as research from Which? found the growing shift towards everyday tasks being carried out online following the onset of the pandemic has led to a devastating surge in scams.
Action Fraud figures, in the year to April 2021, show 413,553 instances of fraud were reported - an increase of a third (33 per cent) on the previous 12 months.
More than £2.3bn was lost by victims as a result, causing huge financial and mental distress.
In May 17 groups - including Pimfa - joined forces to warn about online scams and lobbied the government to include methods to tackle this issue in its Online Safety bill.