The government has said it is upping the ante on stamping out ads from online fraudsters and scammers by strengthening its "pioneering internet safety laws" and amending its Online Safety Bill.
The Department for Digital, Culture, Media and Sport and the Home Office – which have also launched a public consultation as part of an overhaul of how online advertising is regulated in the UK – said they would be adding a "new legal duty to the Online Safety Bill requiring the largest and most popular social media platforms and search engines to prevent paid-for fraudulent adverts appearing on their services".
The Online Safety Bill now includes a broadened scope to include paid-for advertising by scammers, rather than just content posted by users.
The move marks something of a U-turn for culture secretary Nadine Dorries. Back in December, she argued extending the bill for paid-for ads "would not work", while noting such ads were being looked at in separate work on online advertising being carried out by the DCMS.
Under the current draft of the bill, search engines and platforms including Google, Facebook, Twitter and YouTube have a "duty of care to protect users of their services from fraud committed by other users", including "catfishing romance scams and fake stock tips posted by other users" – "users" being the operative word.
But from today, the government is adding a new duty to the bill to focus on fraudulent paid-for ads on social and search, which will be controlled by the platform or an advertising intermediary.
"These companies will need to put in place proportionate systems and processes to prevent (or minimise in the case of search engines) the publication and/or hosting of fraudulent advertising on their service and remove it when they are made aware of it," it said.
"It will mean companies have to clamp down on ads with unlicensed financial promotions, fraudsters impersonating legitimate businesses and ads for fake companies. It includes 'boosted' social media posts."
Regulator Ofcom will set out more details on what platforms will need to do to fulfil the new duty codes of practice. Measures could include ensuring companies scan for scam ads before they are uploaded, checking identities of people posting ads and ensuring financial promotions are only made by companies authorised by the Financial Conduct Authority.
The onus will be on Ofcom to police whether or not companies have adequate measures and systems in place to fulfil the duty of care, but it will not assess individual pieces of content.
However, industry observers have argued that the amendment to the Online Safety Bill raises a question mark over which body will prioritise policing ads that fall foul, as responsibilities fall somewhere between the remits of Ofcom, the Financial Conduct Authority and the Online Advertising Programme, as well as other watchdogs and regulatory bodies.
Having faced lobbying pressure from campaigning groups including Which?, the FCA and financial journalist and campaigner Martin Lewis, the government has now opted to include scam ads in the bill. These can be from criminal gangs that purport to be fronted by the likes of MoneySavingExpert's Lewis, for instance.
It was felt that the bill had a gap in legal coverage, although regulation would have been covered by the Online Advertising Programme.
The Online Advertising Programme was originally announced back in 2019 in the Online Harms White Paper, but had been delayed due to lockdown.
As part of the programme, the government is opening a consultation on proposals to tighten rules for online advertising, a move it said would "bring more of the major players involved under regulation and create a more transparent, accountable and safer ad market".
Commenting on today's news, Dorries said: "We want to protect people from online scams and have heard the calls to strengthen our new internet safety laws. These changes to the upcoming Online Safety Bill will help stop fraudsters conning people out of their hard-earned cash using fake online adverts.
"As technology revolutionises more and more of our lives the
law must keep up. Today we are also announcing a review of
the wider rules around online advertising to make sure industry
practices are accountable, transparent and ethical – so people
can trust what they see advertised and know fact from fiction."
Stephen Woodford, chief executive of the Advertising Association said the organisation will be "engaging in the comprehensive review" the government is undertaking.
He commented: "Whilst bad actors indeed need to be dealt with through appropriate enforcement, the Online Safety Bill now seems to be widening its scope on the same day as the Online Advertising Programme is published, promising a comprehensive review of online advertising and the way it is regulated.
"This legislation will have significant implications for all relevant stakeholders and needs to be considered very carefully."
Woodford added that the government has a "vital role to play" in increasing national cyber awareness and providing a strong enforcement system.
"We fully support the Government’s aim of making the UK the safest place to go online while ensuring it is the best place in the world to do business online too," he continued.
Woodford added: "We are proud too that the UK has a gold-standard self-regulatory system encompassing the CAP Code, IAB Gold Standard, TAG, Global Alliance for Responsible Media, the Financial Audit Toolkit and robust industry standards and deliver a multi-faceted framework to regulate online advertising."
He concluded: "Any additional regulation should seek to protect consumers and prosecute bad actors, whilst enabling the UK to remain at the forefront of the digital economy.”
The latest announcement from the DCMS effectively brings in changes proposed by a joint committee made up of members of the House of Commons and House of Lords, which in December put forward major changes to the bill before it goes to Parliament in 2022 and becomes law.
.jpg)
.jpg)