Lawmakers in the UK are preparing to ease proposal that requires technology companies to compensate victims in case of online financial frauds, reported Financial Times.
The decision comes after the Treasury and the Department for Science, Innovation, and Technology raised concerns over the proposal’s impact on the industry.
A new national fraud strategy, which aims to establish a coordinated approach between the government, law enforcement, and the private sector, is expected to be announced by the government this week.
It is anticipated that the lawmakers will unveil a voluntary pact whereby the technology sector will commit to actively tackling online fraud, rather than holding technology companies accountable for reimbursing victims.
Last November, Prime Minister Rishi Sunak stated that the government would “shortly” release its fraud prevention plan.
However, according to those in the know, there were reservations within the government about earlier proposals, which is why it was postponed.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataUnder the proposed online safety bill, large platforms will be subject to a “duty of care” to safeguard users from fraudulent and other harmful content.
The lawmakers went further and proposed measures to hold the tech and telecom sector responsible for compensating victims of fraud.
As per the existing “safe harbour” principle, platforms are not liable for content on their sites until they become aware of it.
However, some people were concerned that this might pave the way for lawsuits against tech companies for the content they host.
According to an official, there was a need to strike a balance between safety and pro-growth policies and it was possible to combat online fraud without adversely affecting the industry’s financials.
Tech businesses would make commitments about the steps they would take to reduce fraud as part of the strategy’s rollout.
These would include modifications to their platforms’ interfaces to make it simpler to detect and report fraudulent content.
Businesses are already tracking and blocking the IP addresses of scammers, scanning photos, and using machine learning (ML) to identify fraudulent activities.
