UK to require search, social media sites to block fraudulent adverts

The UK government has announced it is adding new requirements to its Online Safety Bill that will hold social media platforms and search engines accountable for scam or fraudulent adverts that appear on their sites.

The changes will fall under provisions set out in the proposed Online Safety Bill, a draft of which was published in May 2021. Currently, search engines and other platforms which host third-party, user-generated content only have to protect users against fraud committed by other users. This includes anyone offering fake financial advice or participating in romance scams, such as so-called catfishing.

The new duty the government is adding to the bill takes that obligation of care one step further, to protect users from fraudulent paid-for adverts, whether they are controlled by the online platforms themselves or advertising intermediaries. The new provisions will require social media and search engine companies to prevent  fraudulent adverts from appearing on their sites.

It’s not yet clear what the search and social media sites will need to do, technically, in order to comply with this new proposal. The government regulator, Ofcom, will outline further details about what the platforms will be required to do to fulfil their new duties in codes of practice in the future, according to the government announcement. Ofcom will have the power to hold companies to account by blocking their services in the UK or issuing fines of up to £18 million (US$23.7 million), or 10% of annual turnover.

The government is also launching a public consultation on its Online Advertising Programme (OAP), looking more broadly at how online advertising is regulated in the UK, examining proposals to improve transparency and accountability and tackle harmful, fraudulent, and misleading adverts. 

It will look at current regulations and regulators to determine whether they’re being properly funded and have the necessary authority to act. The consultation will also consider the whole supply chain related to what the government calls ‘high-risk advertising’ — for products and service related to weight loss or alcohol, for example — and whether ad-funded search and social media platforms such as Meta, Snap and Google are doing enough to tackle fraudulent and harmful advertising.

The OAP consultation will be open for 12 weeks from Wednesday, 9 March 2022. The government intends to respond to the consultation and outline proposals to reform online advertising later this year.

Cases of online fraud exploded during the pandemic

Earlier this year, the Commons Treasury committee said ministers needed to bring in fresh laws and strengthen regulatory powers for fighting fraud after a dramatic surge in scams during the COVID-19 pandemic. The committee said there had been a 43% jump in fraud and computer misuse between June 2019 and June 2021.

Martin Lewis, founder of MoneySavingExpert.com and the Money and Mental Health Policy Institute, settled a lawsuit against Facebook in 2019 after over 1,000 scam adverts abusing his name or image appeared on the platform. As part of the settlement, Facebook promised to launch a dedicated tool to report scam adverts and donate £3 million to a new Citizens Advice project to help victims who had fallen target to the fake adverts.

Commenting on the announcement about the new requirements, Lewis said he was thankful that the government had listened to himself and others who have been campaigning to ensure scam adverts are covered by the Online Safety Bill.

“Until now, only user-generated scams were covered — which risked pushing more scam ads, incentivizing criminals to shift strategy,” he said, in a media statement forwarded by the government. “Now we and others need to analyse all elements of this new part of the Bill, and work with Government and Parliament to close down the hiding places or gaps scammers can exploit.”