The U.K. government is making amendments the draft Online Safety Bill, as the BBC has reported. These measures are being introduced to specifically target scam advertising – something that is escalating throughout the British Isles.
This alternation comes not long after the consumer rights group Which? reported that bank transfer fraud victims lose £28,000 an hour.
The Online Safety Bill is a proposed Act of the Parliament of the United Kingdom intended to improve internet safety, published as a draft on 12 May 2021.
In response to the news, OneSpan’s Director of Product Security, Frederik Mennes, notes that although the change is certainly welcome, it simply does not go far enough.
Mennes tells Digital Journal that scams are an ever present risk to consumers: “Fraud is a persistent issue that impacts not only consumers, but banks as well.”
With the bill itself, Mennes is supportive: “The Online Safety Bill is a welcome change of tone from the British government to specifically target paid-for scam ads – one of the most emotionally and financially damaging schemes for victims.”
However, here is the ‘but’ as according to Mennes: “Is this enough to redress the full scale of the issue or do government measures need to go further?”
Mennes maintains that more can be done to protect everyday users of Internet services, noting: “Consumer protection must be the number one priority for financial institutions (FIs) and regulators. However, the figures released by UK Finance not only represent a catastrophe for those who lose their savings to fraudsters – but also a major problem for building consumer trust.”
Digital transformation, while driving a multitude of business improvements is also expanding the threat landscape. Mennes says: “As banks and FIs continue to expand the digitalisation of their services, security and fraud prevention is paramount to building the necessary trust with consumers.”
There are other risks as well, Mennes finds: “Authorized push payment (APP) fraud is directly costing banks hundreds of millions of pounds a year in reimbursements and lost customers. By investing in fraud prevention technologies, banks and FIs are laying the framework for greater customer retention and lower lost reimbursements for years (or even decades) to come.”
As to what to make of this, Mennes recommends: “For policymakers, there is not only a moral imperative to further the scope of regulations – there’s a financial incentive to maintain the health of the UK’s banking industry.”
In addition, Mennes indicates: “The current Strong Customer Authentication (SCA) requirements in PSD2 are not sufficient to stop APP Fraud. Hence, I encourage the European Commission to adapt the scope of the SCA requirements to help stop this type of fraud.”
