UK should legislate to prevent fraudulent online ads – FCA

The Financial Conduct Authority (FCA) logo can be seen at the agency’s headquarters in the Canary Wharf business district in London on April 1, 2013. REUTERS / Chris Helgren / File Photo

LONDON, Oct.21 (Reuters) – Britain is expected to legislate to end fraudulent online advertising in order to tackle the upsurge in fraudulent attacks on consumers, the Financial Conduct Authority (FCA) said on Thursday.

The regulator said paid advertising promoting scams should be included in the government’s online security bill, which currently only covers user-generated content.

The watchdog said the fraud should be classified as “priority” illegal content, requiring online platforms such as Google (GOOGL.O) and Facebook (FB.O) to monitor and take preventative action.

The call comes as lawmakers, banks and consumer groups are increasingly alarmed by an outbreak of fraud in Britain, with criminals stealing a record £ 754million ($ 1 billion) from the average scams in the first six months of this year. Read more

FCA made the recommendation as part of its “scope report”, an annual review of its responsibilities.

The watchdog also reiterated its call to close loopholes in the rules that currently promote high-risk investments to consumers.

“We see real risks to consumers outside of our remit of both online advertising and those who use exemptions to sell products to regular customers,” said Nikhil Rathi, Chief Executive Officer of FCA.

“Change is needed and we will continue to push for power where we need it.”

($ 1 = 0.7248 pounds)

Reporting by Iain Withers, editing by Lawrence White and Hugh Lawson

Our Standards: Thomson Reuters Trust Principles.

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