The government is not planning to include scam protection in its forthcoming Online Harms Bill but the Money and Mental Health Policy Institute is warning that this a mistake, and that government should give its new online watchdog the powers to prevent firms enabling this criminal activity. The call for action is backed by firms such as Quilter.
New research by the charity shows that a lack of consumer protections against online scams has left vulnerable people as “easy prey” for fraudsters. In particular, it shows that over 4.5m people with mental health problems have been victims of online scams — causing crippling financial harm and distress.
Furthermore, the pandemic has made this risk more acute — with nearly 2 million UK adults falling victim to online scams in the six months after lockdown began.
Commenting on the report, Martin Lewis, founder and chair of the Money and Mental Health Policy Institute, said: “The UK already faced an epidemic of scams, but now lockdown has accelerated it, especially online. These vicious criminals are exploiting the fact that more people are stuck at home, spending more time online, and potentially struggling with their mental health — all of which increase the risk of falling victim to these schemes.
“To add insult to injury, the fraudsters are getting away with it. I’ve been campaigning against online scams for three years, but UK consumer protections remain hopelessly inadequate — leaving vulnerable people as easy prey for online criminals, and causing trauma and crippling money problems in the middle of this global crisis.
“Now we are to have an Online Harms bill and watchdog, and it would of course be unthinkable if they didn’t include scams. Yet perversely, laughably, embarrassingly that seems to be exactly what the government is planning. We need MPs to take up a clarion call to ‘Add Scams to The Bill’ to ensure the new regulator has the power to tackle it.
“Failing to act now will leave vulnerable people defenceless at the hands of scammers, who everyday are coming up with more sophisticated ways to con people out of money and data.”
Jane Goodland, corporate affairs director at Quilter (pictured), said: “The government has opened up a can of worms in their scrutiny of online harms. What’s come to the surface has been an epidemic of financial scams, including fake investment scams, fraudulent Covid testing kits, fake HMRC texts and the list goes on. These scams will only get worse without firm government action. Quilter’s recent research shows that this year, the Financial Conduct Authority has issued 301% more scam warnings than in 2015.
“As such, it is imperative that financial scams are included in the Online Harms Bill, so that the new online harms regulator has the power to tackle ruthless scammers by forcing social media sites or search engines to take more action to prevent these criminals using their websites as tools to rip-off the most vulnerable.
“At the moment we are in the absurd situation where there is no legally enforceable way of obliging search engines and social media platforms to remove ads for financial scams. As a result, the Financial Conduct Authority are spending considerable sums of money to post its own adverts warning consumers of the risk of scams.
“Something must be done to stop scammers reaching potential victims and we believe the government has an opportunity to do just that by including financial scams within the scope of their Online Harms legislation.”
