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2 Feb 2022

MPs call for greater protections against scams

Inquiry into scams and fraud finds significant consumer harms in online advertising and bank transfer fraud

A Treasury Committee report urges regulation to protect scams victims and tackle the scams epidemic.

The report on economic crime was compiled by the Treasury Committee after a six-month inquiry into the extent of consumer harm caused by scams, fraud and other economic crimes.

The Committee's role is to examine the effectiveness of policies at HM Treasury, HM Revenue and Customs, the Financial Conduct Authority, The Bank of England and other financial public bodies.

Economic crime report

Supporting Which?'s campaign calling for greater protections against scam adverts online, the report also suggests the online tech giants that host dodgy ads could be held responsible for reimbursing victims for any money lost.

It repeated calls for the government to legislate to make sure financial organisations refund victims of bank transfer fraud. This is something Which? has also been calling for since our super-complaint over five years ago. In November, the regulator announced plans for legislation to make reimbursement for victims of bank transfer fraud mandatory.

The committee's inquiry also identified that too many agencies are involved in tackling fraud and suggests a single organisation focused on fighting these types of crime could be more effective. It also said more resources are needed.

The impact of online scams

Which? research previously found that almost 1 in 10 have fallen victim to online scams they were sucked into after seeing an advert on either social media or a search engine.

The financial and emotional impact on victims is significant. While Which? found the average loss to a scam at around £600, it estimates the personal impact on each victims' wellbeing equates to a loss of around £3,684.

Rocio Concha, Which? Director of Policy and Advocacy, said:

'The government must act on the Treasury Committee's recommendation for the Online Safety Bill to include paid-for scam adverts and for online platforms to be given a legal duty to prevent this fraudulent content from appearing in the first place.

'Online scams have a devastating impact on victims and there is now an overwhelming consensus that the government must force the biggest tech companies to finally take responsibility for fraud carried out using their platforms.

'The committee is also right to call for the government to legislate urgently to make reimbursement mandatory for bank transfer scam victims and to put an end to the unfair and inconsistent treatment many victims face when trying to get their money back after they are targeted by fraudsters.'

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