THIRTEEN banks back our campaign to force tech giants to crack down on fraud

Britain’s five biggest banks have endorsed a landmark letter from Money Mail to the Prime Minister calling on him to force social media firms to crack down on scammers operating on their platforms.

Money Mail delivered the letter to No 10 Downing Street yesterday. 

The support from the banks and the minister for our demands to Rishi Sunak is a huge step forward for this newspaper’s Stop The Social Media Scammers campaign.

The endorsement comes after Money Mail hosted a major fraud summit last week at The Goring Hotel in London attended by the Security Minister Tom Tugendhat, MP Anthony Browne — the Prime Minister’s anti-fraud champion — senior bankers, industry group UK Finance and politicians.

In a rare show of unity, officials from eight of the UK’s largest banks and building societies joined Money Mail to set out the urgent action we believe tech companies must take to protect their users from criminals. 

Call to action: Reporter Jessica Beard at Downing Street with our letter for the Prime Minister 

One senior banker said: ‘It’s extremely unusual but all the banks around the table agree about what action needs to be taken.’

Yesterday, as Mr Sunak hosted his first Cabinet meeting after a major reshuffle, Money Mail put these demands to the Prime Minister directly. All the banks support our calls for the Government to:

• Require technology companies to pay towards the cost of reimbursing victims who lose money after falling for scams originating on their platforms.
• Compel social media platforms to introduce tougher identity verification measures to stop fraudsters setting up social media accounts.
• Make sure sales sites such as Facebook Marketplace offer users secure payment systems to buy and sell.
• Ensure the firms face fines from watchdogs if they fail to stick to new regulations.

Money Mail’s campaign has exposed the shocking scale of fraud that originates on social media sites since it launched in August. 

Our postbag has been filled with letters from hundreds of readers who have been caught out by scams.

In one shocking case, retired ambulance driver Peter Verheul was tricked into handing £117,000 to crypto con artists after he saw a video promoting an investment on social media site TikTok.

Senior bankers from Britain’s biggest banks now agree with Money Mail that change is needed. 

Senior officials from UK Finance and Lloyds, Barclays, Santander, NatWest, HSBC, Nationwide, TSB and Starling Bank attended the summit.

These banks, plus Metro Bank, Virgin Money, Revolut, The Co-operative Bank and Handelsbanken, threw their weight behind our letter to the Prime Minister, totalling 13 banks. 

Whilst not putting his name to our letter, the Security Minister has welcomed our calls to get social media companies to crack down on fraud.

At the summit, industry leaders said social media platforms, such as Facebook and Instagram, are failing to take responsibility for fraud — and are likely to continue to do so unless the Government enforces tough new rules. 

Data from Lloyds has shown more than two-thirds of purchase scams start on Facebook and other Meta-owned platforms.

NatWest, TSB, Lloyds, Nationwide, Barclays and Santander have previously criticised Meta — the empire controlled by billionaire Facebook founder Mark Zuckerberg — for being the UK’s largest source of fraud. Santander reports 70 per cent of purchase scams originate on Facebook and Instagram.

Money Mail’s investigations have previously found scams on Facebook, WhatsApp or Instagram — all owned by Meta — account for an astonishing 16 per cent of all the crimes recorded in the UK. 

A total of 1.1 million people fell victim to scams that could be traced back to the company’s platforms last year.

Until now, banks have shouldered the cost of reimbursing victims. Tech firms have no legal or regulatory obligation to reimburse those who lose money to scams originating on their platforms. 

Facebook crooks: A total of 1.1 million people fell victim to scams that could be traced back to social media platforms owned by Meta last year

The banks believe the only way to stamp down on the practice is for social media companies to share the bill — and face fines if they fail to prevent fraud on their platforms.

One senior banker told the politicians present: ‘Tech companies should contribute towards reimbursing victims or have some incentive to invest in preventing fraud from happening on their platforms.’

There are multiple ways tech companies could share the burden of reimbursing scam victims, those present said. One banker said social media platforms could be forced to reimburse scam victims in the same way banks are obliged to.

‘You [the Government] could mandate them in the way that you have with banks. Or, the second way is, if the banks are telling them that scams are originating on their platforms and pointing to the exact scam, then if they don’t subsequently act, they should become liable.’

More than half a billion pounds has been lost to fraud this year, the latest data sent to the Government last month by industry body UK Finance revealed.

The banks present also agreed that social media firms should be compelled to share data with them and law enforcement agencies about fraudsters operating on their platforms.

One official said: ‘The sharing of data is absolutely critical.’ Tech companies have extensive stores of data on their users —including on fraudsters. This could be used to identify them and spot patterns that could help both the police and banks prevent victims from losing money.

Messaging service WhatsApp has repeatedly warned it would sooner pull its business out of the UK if new legislation forced it to ditch ‘end-to-end’ encryption, which allows messages to be sent between users with no risk that they can be read by third parties. 

There had been proposals to ban end-to-end encryption in the Online Safety Act, which was passed into law last month, but they were scrapped at the last minute.

One banker said: ‘We continue to take small incremental steps forward but unless we make a leapfrog improvement, the criminals will move quicker than us.

‘Unless it is going to hit tech companies in the bottom line, they will continue to tick boxes and make incremental steps.’

A Meta spokesman says: ‘With tens of millions using our apps daily in the UK, we recognise our important role in tackling the industry-wide issue of scams. 

‘We don’t want anyone to fall victim to these criminals which is why our platforms have systems to block scams, financial services advertisers now have to be FCA authorised and we run consumer awareness campaigns on how to spot fraudulent behaviour.’

This post first appeared on Dailymail.co.uk