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UK banking and finance lobby group claims Facebook Meta owner’s social media sites hold more than half of the digital payment frauds Britain has suffered.
UK Finance, which represents more than 300 financial firms, has written to Jeremy Hunt, the finance minister, with data on sources of payments fraud in Britain broken down by value and volume, according to two people familiar with the situation.
The letter says 61 percent of all authorized pay-as-you-go scams by volume are linked to Meta, the company that owns social media sites Facebook, Facebook Marketplace, Instagram and WhatsApp, the people said.
The UK’s financial move is a renewed push by industry to persuade ministers to force tech giants to take more responsibility for the rise in financial crime. UK ministers announced a national fraud strategy in May, but shot down an earlier proposal to have tech companies offer compensation.
Authorized Pay As You Go fraud is a scam in which fraudsters trick people into transferring amounts from their bank accounts. This type of fraud has escalated during the pandemic at a time when many people were relying on digital services.
About £485m was stolen through authorized pay-as-you-go scams last year, according to UK Finance. These scams include texts purporting to be from relatives asking for money, and demanding that the victim must pay a fine or pay back tax.
The letter comes amid mounting tensions over companies responsible for compensating fraud victims.
Banks have a voluntary agreement to improve refunds to authorized fraud victims for immediate payment, though rates vary widely. But UK Finance has called on the tech industry to take more responsibility, noting that online sites are responsible for most payments fraud.
Julian David, chief executive of the TechUK trade consortium, said it was “working closely with the UK government and finance to tackle online fraud”.
He added: “Technology companies will continue to take further significant measures to reduce fraud as laid out in the UK’s recent fraud strategy, and we are currently working closely with government and the financial services sector to tackle the problem of authorized payment fraud.” .
The National Fraud Strategy aims to harmonize the approach of government, the private sector and law enforcement. But the plans have been watered down in favor of a voluntary “cyber fraud charter”.
A number of technology companies, including Meta and Microsoft, have tightened their approach to advertising so that UK financial services companies seeking to advertise with them must obtain approval from the Financial Conduct Authority.
Tech companies are also already scanning images and blocking scammers’ IP addresses, while using machine learning to detect fraudulent behavior.
Recent figures show that the 10 banks that signed up to the fraud compensation scheme showed a decrease in complaints to regulators last year. However, lenders who chose not to join the equity plan reported a 38 percent increase in complaints.
UK Finance declined to comment.
A Meta spokesperson said this is an industry-wide problem with scammers using increasingly sophisticated methods to defraud people in a variety of ways — including email and SMS, as well as offline.
“We don’t want anyone to fall victim to these criminals, which is why our platforms have systems in place to prevent scams, financial services advertisers are now required to be authorized by the Financial Conduct Authority (FCA) and we run consumer awareness campaigns on how to spot behavior fraudulent.”
Meta said people could also report such content with a few simple clicks and the company was working with the police to support their investigation.
