In an unusual attack by the chairman of a furious committee, social media bosses were called a ‘disgrace in Parliament’ today. They failed to act enough to end online scams.
Julian Knight, Conservative MP, sat in silence with executives of YouTube, Facebook and TikTok as he condemned them for refusing to share information about scammers among themselves to protect the public.
He demanded all four companies pay back money defrauded on Britons for “many years” while the companies were accepting adverts from firms not authorized by the Financial Conduct Authority.
Knight claimed that no companies had shared their data, and only the “already overworked” police were sharing it. That gives the opportunity for scammers to target different social media users through better targeting.
This was compared to the Mail Order Protection Scheme, (Mops), an older scheme that newspapers used to run to ensure readers’ safety. Direct response ads were reviewed before being published and their findings shared with other publishers.
The attack came around twenty minutes into the Digital, Culture, Media and Sport subcommittee’s discussion of online harms and disinformation.
He talked to “all social media platforms” – which included witnesses Iain Bundred (Youtube’s head for public policy in the UK, Ireland), Richard Earley (UK public policy manager Meta); Elizabeth Kanter (TikTok director of government relations public policy) and Niamh McCDade (Twitter’s deputy chief of UK policy).
Conmen stole £754million from Britons through fraud in just the first half of 2021 which was an increase of 30 per cent on the previous year according to trade group UK Finance – with most of these scams originating online.
Julian Knight, Conservative MP, condemned social media companies’ refusal to share information on fraud artists among themselves
Niamh McDade (left), Twitter’s deputy head of UK policy; and Elizabeth Kanter (right), TikTok’s director of government relations and public policy, both gave evidence during the Digital, Culture, Media and Sport sub-committee hearing today
Richard Earley, UK Public Policy Manager for Facebook’s owner Meta, and Iain Bundred, YouTube’s Head of Public Policy in the UK and Ireland, gave evidence today to the Digital, Culture, Media and Sport Sub-committee.
In an attempt to interrupt the answer given today by Mr Earley, Mr Knight stated: “I’ll tell you the truth, my thoughts, this applies to all platforms, honestly – you should pay back the money defrauded from the British public over many decades while you’ve been taking ads that are not FCA approved.
Knight is a media expert. He was formerly a journalist covering consumer rights and personal finances before he joined the House of Commons.
The MP for Solihull started off as a personal finance reporter for BBC News before becoming the money and property editor for the Independent on Sunday in 2007.
And he told today’s hearing in the Grimond Room at Portcullis House: ‘Now I used to work in the dim and distant past in the newspaper industry and at that stage we used to have Mail Order ‘Mops’, it was called.
“You could see if a company held a deposit and if it was authorized to trade. You also had the ability to determine if it could advertise effectively in your newspaper.
“And you discovered that you had any idea or linkage that would make these companies more effective, you rang each other and told them that they were doomed.
He continued: ‘Now I don’t see anything in what you’ve just said there, in fact I know across all your companies, none of you have effectively even shared this data with each other – you do share it to the police, they’re already overworked – but you don’t do it with each other.
“And secondly, because you’ve taken years of money from scammers and have not made any efforts to protect yourself, there is only one way you can stop this. That would be to ban anyone who advertises with you that was not FCA-authorized.
“Personallly, it is a shame and has gone on far too long. Each of your businesses should return any money stolen from the British people.
“That’s not actually a question. At this point, that’s an observation. However, it’s my opinion that you have not done enough for a prolonged period of time.
It comes after Culture Minister Chris Philp told MPs last week that there are a ‘number of areas’ where the Online Safety Bill can be ‘improved substantially’, with a revised piece of legislation expected in the coming months.
All four social media bosses appeared at the Digital, Culture, Media and Sport sub-committee hearing via videolink today
The Joint Committee on Online Safety Bill Draft Report was presented to MPs for debate. It stated that more offenses should be included.
They included fraudulent and paid-for advertising scams, fraud, and cyber flashing.
The Bill should also clarify what is illegal online. The report suggested that porn sites have to be held responsible for keeping children away from them, regardless of whether or not they are hosting user-to-user material.
The legislation is expected to force the biggest operators, such as Meta – formerly Facebook – and Google, to abide by a duty of care to users, overseen by Ofcom as the new regulator for the sector.
It was revealed by Ministers today that crypto-advertising will need to be compliant with the same requirements as financial promotion, like insurance. This is to protect consumers from misleading claims.
The Government stated that promotions will now be aligned with financial advertisements, making them fair and transparent and helping people make informed choices.
The plans include promotion of cryptoassets under FCA rules, in accordance with other financial promotions such as stocks, shares and insurance products.
According to the Government, this would balance the need for innovation with the requirement to make sure that advertisements are honest and clear.
There are 2.3 million UK residents who own cryptoassets. However, research shows that some people may not be fully aware of what they’re buying. This could lead to mis-sold products. Around £300 of cryptoassets are held on average.
Modifying the Financial Promotion Order will bring about the changes. It outlines the types of investments and activities that are eligible for the Financial Promotion Order.
The Financial Services and Markets Act 2000 prohibits businesses from promoting financial products unless they have been authorized by the FCA/PRA (Prudential Reg Authority) or the promotion content is approved by such a firm.
Companies that want to encourage such activities and investments must adhere to binding rules. Financial promotions must be honest, transparent, and not misleading.
According to the Government, legislation will be presented once there is enough time in parliament.
Santander UK recently warned that around £1 million of cryptocurrency scams were being reported to it by customers each month.
According to the bank it saw an increase in these cases. These can include fraudsters taking over victim’s computers and freezing their funds.
Online advertisements for cryptocurrency investing ‘opportunities’ may appear on customers’ screens. Other social media users might introduce them to the adverts. Advertisements can also look endorsements by famous people.