The UK government has secured support from major technology companies for a "world-first initiative" Online Fraud Charter, marking what the government calls a significant step in combating online fraud and scams.
This agreement aims to enhance the measures taken by technology firms to identify and remove fraudulent content from their platforms.
Key aspects of the charter include:
Verification of Advertisers and Marketplace Sellers: Companies will focus on authenticating the identity of those who advertise or sell products on their platforms, making it more difficult for fraudsters to operate under false pretenses.
Improving Fraud Reporting Mechanisms: Enhanced processes for reporting fraud will be implemented, making it easier for users to report suspicious activities and for companies to take prompt action.
Amazon, eBay, Facebook, Google, Instagram, LinkedIn, Match Group, Microsoft, Snapchat, TikTok, X and YouTube have all voluntarily signed on, pledging to take certain actions outlined in the charter within the next 6 months.
- Blocking - Deploy measures to detect and block fraudulent material
- Reporting - Have a simple and quick route to report fraudulent material
- Takedowns - Take action against fraudulent content and users straight away
- Advertising - Deploy measures to protect people from fraudulent adverts
- Law enforcement - Have dedicated liaisons who will respond to law enforcement requests
- Intelligence sharing - Engage with initiatives to quickly share information about frauds
- Transparency - Provide information about fraud risks and what is being done to address them
- Comms - Deliver simple messaging to support the public to recognise and avoid online fraud
- Horizon scanning - Contribute to horizon scanning exercises to stay ahead of the threat
Interestingly, the charter specifically calls out "money muling" as one form of fraud that marketplaces need to address.
What is fraud and money muling?
Fraud involves an act or intention of dishonesty, normally through deception or breach of trust, with the intent to either make a gain or cause a loss of money or other property.
Money mules are individuals recruited by fraudsters and serious organised crime groups to move criminal funds on their behalf – through their banking or cryptocurrency accounts, or through cash. Children and vulnerable adults can be coerced, groomed, or deceived into laundering funds this way and in these cases are the victims of financial exploitation, and should be recognised as such.
Cyber-crimes(defined as Computer Misuse Act offences) occur when there is unauthorised access to computers, networks, data and other digital devices. This can allow cyber criminals to commit further malicious cyber activities such as ransomware attacks, unauthorised account access, intellectual property theft, denial of service attacks, or the stealing of large personal data sets. Unauthorised computer access can enable and facilitate a wide range of frauds, theft, sextortion and more.
eBay in particular has been a haven for triangulation fraud, a very sophisticated form of credit card fraud that often blurs the lines into money muling as well.
There's a long running scam involving fraudulent vehicle listings on hijacked accounts that is especially prevalent on eBay UK with similar variations targeting high end trading cards, luxury watches, and other hot, in-demand items as well.
Signing onto the UK Online Fraud Charter may also be an important step for eBay to quell investor concerns after their most recent 10-Q report revealed an $11 Million bad debt expense resulting from the recovery of losses related to a mysterious unnamed "non-recurring" consumer fraud incident in 2022.
Do you think the UK Online Fraud Charter will be effective in stopping ecommerce fraud and scams? Let us know in the comments below!