JustUs welcomes crackdown on paid-for adverts
JustUs chief Lee Birkett has welcomed the government’s plans to force social media sites and search engines to stamp out fraudulent paid-for adverts.
The government has added a duty to the Online Safety Bill, which will bring fraudulent paid-for adverts on social media and search engines into scope, whether they are controlled by the platform itself or by an advertising intermediary.
These companies will need to put in place proportionate systems and processes to prevent the publication of fraudulent advertising on their service and remove it when they are made aware of it.
It will mean companies have to clamp down on ads with unlicensed financial promotions, fraudsters impersonating legitimate businesses and ads for fake firms. It also includes ‘boosted’ social media posts by users where they pay to have their ads promoted more widely.
Ofcom will set out further details on what platforms will need to do to fulfil their new duty in codes of practice, which could include ensuring financial promotions are only made by firms authorised by the Financial Conduct Authority (FCA).
Ofcom will have the power to hold companies to account by blocking their services in the UK or issuing heavy fines of up to £18m, or 10 per cent of annual turnover.
Birkett welcomed the news but criticised the government for how long it took them to implement it.
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“That’s great news they’re including paid-for advertising, it’s very welcome,” he said.
“It should help dramatically because a large percentage of the paid-for adverts are not regulated. People were dominating the paid-for clicks and they weren’t regulated.
“The scammers doing comparisons for investment bonds and peer-to-peer lending and non-regulated investing and top 10 ISAs, which people think is a regulated advert but it’s not, were dominating the Google searches and should be gone. They should enable proper regulated advertising to appear at the top of the advertising.
“It’s good but it’s ridiculous people have had to fight for it to be included, in fact it’s a disgrace. Everyone wanted it and it was falling on deaf ears. The government was forced to make the change, if they were listening, a year of lobbying wouldn’t have been required.”
Both the FCA and UK finance also welcomed the government’s change to the Online Safety Bill.
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“We welcome that the Online Safety Bill will now require the largest platforms to tackle fraudulent advertising,” said Mark Steward, executive director of enforcement and market oversight at the FCA.
“We have been clear about the need for legislation and appreciate the government’s positive engagement on this. We look forward to working closely with the government and regulatory partners as they finalise and implement the details of the draft bill.”
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“We strongly welcome the government’s announcement that it will expand the scope of the Online Safety Bill to include advertising on social media and search engines,” said David Postings, chief executive of UK Finance
“UK Finance, alongside a number of other bodies, has long been calling for the government to make this change.”