Google cracks down on financial-scam adverts
Google is cracking down on financial-scam advertisements in the UK.
From 30 August, any company advertising financial services on the search engine must be authorised by the Financial Conduct Authority.
Last year, the FCA issued 1,200 consumer warnings about scams advertised by fake companies through social-media platforms.
Google’s latest move was a “significant step”, it said, but a permanent solution may be required by law.
Google UK and Ireland managing director Ronan Harris said: “Today’s announcement reflects significant progress in delivering a safer experience for users, publishers and advertisers.
“While we understand that this policy update will impact a range of advertisers in the financial services space, our utmost priority is to keep users safe on our platforms.”
Cryptocurrency adverts are already regulated and only FCA-registered exchanges can advertise.
Google also said it was joining campaign group Stop Scams UK, the first major technology company to do so.
And it pledged $5m (£3.6m) in advertising credits to support public-awareness campaigns.
Evidence given to the Treasury Committee earlier this month suggested the FCA had paid Google more than £600,000 to run anti-scam adverts from 2020 to 2021.
Mark Steward, of the FCA, said at the time: “The irony of us having to pay social media to publish warnings about advertising that they are receiving money from is not lost on us.”
Criminals stole more than £1.2bn through frauds and scams in 2020, according to Stop Scams UK.
A single scam would usually use multiple legitimate platforms to defraud consumers, it said.
And the harm went beyond the financial – also taking a toll on people’s mental and physical health.
In March, Bank of England governor Andrew Bailey urged government to introduce a legal requirement for internet companies to remove financial-fraud websites.
At the time, he suggested the problem could be tackled through the Online Harms Bill and investment scams were added to the legislation at the last minute.
But it did not specifically mention online advertising, which is seen as one of the main ways fraudsters reach the public.
Seven out of 10 financial scams start online, according to UK Finance.
And the coronavirus pandemic has seen a further flurry of scam ads on search engines and social-media sites.
Consumer watchdog Which? said its research had “repeatedly exposed scam ads on Google that can have devastating financial and emotional consequences for victims”.
“It’s good that Google is recognising that it must take far greater responsibility for fraudulent adverts that lead to financial scams,” Which? director of policy Rocio Concha said.
But its success would be judged “by whether they stem the tide of scam adverts”.
She, too, urged the government to make search engines and social-media companies legally responsible for “removing fake and fraudulent content on their sites”.
And the FCA told BBC News: ‘It is important that all social-media firms ensure that financial promotions using their services comply with UK law and we expect all social-media firms to ensure they are in compliance.”