Govt urged to tackle investment scam threat

Quilter has written to the Prime Minister and the Minister for Digital and Culture calling on the government to include scams and other financial harms within scope of the forthcoming Online Safety Bill.

The wealth manager warned that the Online Advertising Programme – which was proposed by the government as the solution to investment scams – will not provide the robust consumer protections required, and has called for urgent government action to include scams in the Bill.

Quilter revealed it had witnessed “first-hand” the ease with which scammers can impersonate regulated financial services firms to promote fraudulent adverts on search engines.

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. The wealth manager highlighted that many cases will not be reported, meaning the true figure lost could be much higher. 

By heeding calls from several consumer groups, trade associations as well as MPs to include scams in scope of the Bill, Quilter believes the government can ensure search engines and social media platforms have a legal responsibility for the content that appears on their sites – and that they will have a duty of care to ensure that users are not exposed to financial harm.

Quilter CEO, Paul Feeney, commented: “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.”

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