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Harmful ads and scams to be included in Online Safety Bill

Ofcom will have the power to issue a fine of up to £18 million pounds – or 10% of the company’s global annual turnover

Social media sites and search engines will have a legal duty to “do more” to protect UK users from harmful, fraudulent and misleading advertisements.

This is according to the latest update to the Online Safety Bill, which aims to regulate the UK’s digital landscape.

It comes as the Department for Digital, Culture, Media & Sport (DCMS) and the Home Office launched a consultation into improving the “transparency and accountability” of the UK’s online advertising market – the largest and fastest-growing in Europe. 

If the legislation is passed, regulator Ofcom will have the power to verify whether social media sites and search engines such as Facebook and Google have implemented systems to “prevent and remove fake adverts”.

If the platforms are caught falling short, the watchdog will be able to not only block the service from functioning in the UK but also issue a fine of up to £18 million pounds or 10% of the company’s global annual turnover.

Culture secretary Nadine Dorries said that the legislation comes amid “calls to strengthen our new internet safety laws”. 

“These changes to the upcoming Online Safety bill will help stop fraudsters conning people out of their hard-earned cash using fake online adverts,” she added.

One of the people campaigning for stronger e-safety regulations is Which? chief executive Anabel Hoult, who described the government’s announcement as “great news” that “could make a huge difference to stemming the tide of fake and fraudulent ads on social media and search engines”. 

However, Hoult also called for legislators to ensure that Ofcom is equipped with “the support and resources it needs to hold companies to account and take strong enforcement action where necessary”.

According to Geraint Lloyd-Taylor, partner in the advertising and marketing team at law firm Lewis Silkin, the watchdog will have to ensure that tech giants take the legal duty to protect their users from harmful ads seriously.

This will include “taking reasonable steps to ensure those ads don’t make it onto their platforms in the first place, and ensuring that ‘repeat offenders’ are banned from placing harmful ads on their platforms”. 

“If platforms fail in those duties, it is very likely Ofcom will be empowered to impose significant financial penalties. The advertisers themselves will continue to answer to the Advertising Standards Authority (ASA), as the ASA will continue to be the relevant regulator when it comes to the content of those ads," he told IT Pro

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"In more serious cases of fraudulent and scam ads, the police and other regulators will continue to play a role in prosecuting the individuals and companies that created and paid for the scam ads, though that is easier said than done in practice."

Lloyd-Taylor also described the latest addition to the Online Safety Bill as “not unexpected”.

“The two committees that recently reported back on the draft Online Safety Bill [i.e. the Joint Committee and DCMS sub-committee] both recommended that some types of harmful paid-for advertising should be included in the scope of the updated Bill,” he added.

Online content fraud levels spiked at the start of the COVID-19 pandemic and reached record numbers in 2021. COVID-related scams, such as duping victims with promises of life-saving medication, vaccines, or financial support, were especially popular, with cyber criminals raking in £34.5 million in the first 12 months of the pandemic

In April 2020, days after the NCSC reported that it had taken down 2,000 online scams, of which 471 were from fake online shops, Google announced that all advertisers would have to be verified before they are allowed to buy ad space on the search engine’s platform.

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