Consumer champions Martin Lewis and Which? gave evidence to the joint committee on the online safety bill on Monday, describing the scale of harm and shocking lack of action from big tech firms to tackle online investment scams. Lewis warned MPs not to let big tech “off the hook” and include scam ads in the online safety bill. 

 

The scale of online investment scams is staggering. Consumer organisation Which? found that between April 2020 and March 2021, people lost £535m just on investment scams, of which the majority happened online. Which? says that this is only a very small part of the harm, because of the impact scams have on the wellbeing of victims – it prices this at £7.2bn per year, or £3,684 a year per person. 

 

Many online investment scams are perpetrated by organised criminals with the help of adverts, placed on platforms like Facebook, Google and more. 

 

Close to tears, MoneySavingExpert founder Martin Lewis told MPs on Monday how the grandmother of an orphan lost the savings of the parents that she held for the child - because she fell for a scam advert that featured his face. 

Lewis condemned politicians and online platforms for their lack of action on what constitutes consumer harm of epic proportions and threatens to undermine the economy. “If you wonder why I get so passionate, I have spent 20 years trying to do consumer protection work and I see people's lives being destroyed,” he told MPs. 

 

In a powerful account, Lewis explained how when his face is used for scam ads, the only law he can currently use to fight it is that of defamation, showing what a lack of statutory instruments there is in this area. 

Lewis, who settled with Facebook for £3m to set up Citizen Advice scam action and on condition that Facebook create a ‘report scam’ button for users, said social media must have a duty of care to ensure scam adverts do not run on their websites. 

 

 

MPs noted that big tech firms can act within seconds to take down footage of Premier League matches that infringes on copyright, and that it must therefore be possible to remove scam ads. 

Lewis said that big tech firms like to hide behind technological problems. “When I have had meetings with the companies, what they often do is they tell me the technologically difficult reasons why it can't be done, to which my answer is, who said you need to do this by technology? I have a website and nothing goes on my website that hasn't been put on by a human being; it's editorial. We have some tools, but we monitor them,” he said. 

 

Companies making billions from advertising that do not have good enough technology to stop scam adverts should "pay human beings to pre-moderate them”, he said, adding: “We should be very careful not to allow them to set the narrative that this must be a technological solution. I don't give two hoots whether it's a technological solution or a manual solution; I just would like to see a solution.” 

 

He urged MPs not to let tech firms shirk their responsibilities while victims suffer: “One of the reasons for me to push with passion and with verve having done this for years, having risked my own reputation by suing one of the biggest companies in the world, is to ask legislators, ‘Do not let them off the hook’. We need to make big tech responsible.” 

 

He likened big tech to pubs who say they are not responsible for what people talk about while in the pub. However, “what you decide to serve in the pub you're responsible for” he said, so when big tech is ‘serving’ adverts and are paid money to publish those, the firms should also take responsibility for them. 

 

The fact that the bill covers user-generated fraud will be meaningless according to Lewis, at least if the definition of an ad is that it has been paid for, as scammers creating user content could simply pay a small fee to make it count as an ad. 

 

The FCA’s chief executive Nikhil Rathi had said earlier this year that since the UK has left the EU – the transition period ended on 31 December last year – online platforms are no longer exempt from the regime on financial promotions.  

  

“We see no reason why different standards should apply to a search engine or social media compared to a newspaper. If these platforms choose to display and profit from adverts for risky – and in some cases fraudulent – investments, they should also comply with financial promotions rules,” he said, noting that inexperienced investors are more than twice as likely to resort to social media. 

   

    

However, it is not clear if this has had an effect on how vigilant big tech firms are about putting up scam ads. Rocio Concha, director of policy and advocacy and chief economist at Which? said there are minimal to no checks for creating an online ad with big tech firms. To test this, Which? previously created an ad for a fake water company which was put up and had 100,000 impressions in the first month. 

 

She said since there is a financial transaction between the advertiser and the platform, it should be easy to perform checks. “That is surely something that they can do,” she said, but added that "there is no real action; it’s not a priority for them". 

 

Concha added that the view that the scope of the online safety bill must be extended was not just that of Which? Institutions from the City of London police to the Association of British Insurers have formed a coalition campaigning for the inclusion of scam ads in the bill, and the Financial Conduct Authority has also come out in support of extending the bill to cover adverts. 

 

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Should online ads be included in the online safety bill?