It’s Time Social Media Platforms Unfriended Fraudsters
For every minute you spend reading this article, another £2,300 is lost to fraud in the UK. With nearly 3 million people falling victim to scams last year, costing customers £1.2bn of their money, the need to tackle this issue is greater than ever. Despite banks detecting and preventing a further £1.2bn of fraud, the cost of investigating and policing suspicious transactions is mounting. This is where the tech platforms must be forced to step up.
Scammers are highly adept at exploiting the biggest weakness in the banking system—human emotion. They use increasingly elaborate deceptions designed to provoke greed, fear, or panic, with more than £485m stolen via so-called authorized fraud in 2022. Nearly 80% of scams originate online, and social media platforms are responsible for three-quarters of this total. Fraudsters can also exploit online marketplaces, dating apps, and messaging services, as well as spoofing telephone numbers to facilitate impersonation and deception.
Tech and telecoms companies might claim they are doing their bit to fight fraud, but they need to do much more if the sums lost to fraud are ever to fall meaningfully. Relying on the banking sector alone to reimburse the victims of fraud means the online platforms that facilitate the majority of fraud have no financial incentive to stop it. In fact, some could even be profiting from it. The government’s new fraud strategy promises to funnel more taxpayers’ money into fighting what is now the UK’s most common crime, but there’s scant hope of tracing and reclaiming the billions being lost.
The imperative to involve the tech sector in the fight against fraud should be all the greater as AI (artificial intelligence) offers terrifying new ways for scammers to defraud us. Using AI to clone someone’s voice “would be pretty easy.” In the future, fraudsters could use AI to clone our voices and phone our relatives instead. The faces of celebrities such as Martin Lewis, Deborah Meaden, and Sir Richard Branson are commonly used by scammers pumping fake investment schemes online. Could future AI-generated incarnations involve convincing calls or voice messages from celebrities? It’s a chilling prospect.
It’s time for social media platforms to take responsibility for their role in facilitating scams. The current rules offer no automatic right to a refund for customers scammed, and the reimbursement rate for refunding victims tricked into authorizing scam payments has only risen to 59%. The long-awaited online safety bill will contain a legal duty for platforms to prevent paid-for fake ads from appearing online. However, the proposed much weaker sounding voluntary agreements instead of forced contributions from tech and telecom companies to the costs of reimbursing victims are a disappointment.
In conclusion, it’s time social media platforms unfriended fraudsters and played a more significant role in fighting fraud. If we are to make a meaningful dent, we need a much bigger focus on fraud prevention and forcing tech and telecoms companies to step up. Technology can no longer be the weak link in the war against fraud.
– In 2022, £67m and £114m were lost to purchase scams and investment fraud, respectively.
– Fraud is now a more significant cost than the branch network for one large high street lender.
– Nearly 80% of scams originate online, according to research by banking trade body UK Finance.
– Social media platforms cannot continue to ignore their role in facilitating scams.
– Without meaningful contributions from tech and telecom companies, the sums lost to fraud will not fall meaningfully.
– It’s time for a much bigger focus on fraud prevention to tackle the increasing prevalence of scams.
– All statistics are from the original article in the Evening Standard.