Pressure Mounts on Meta as Fraudulent Activities on Facebook, Instagram, and WhatsApp Spark Outrage
Meta, the social media giant, is facing escalating pressure from MPs, consumer groups, and the UK banking sector over its failure to effectively combat a “tsunami” of fraud on its platforms, including Facebook, Instagram, and WhatsApp. British individuals are subjected to scams resulting in significant financial losses daily, with some experiencing life-altering consequences.
The Guardian conducted an investigation shedding light on the personal stories of victims who fell prey to scams on Meta’s platforms. A recent nationwide estimate predicts that failing to curb fraud on these platforms will cost UK households a staggering £250 million in 2023.
Disturbing accounts emerged from individuals defrauded on Facebook, Instagram, and WhatsApp. One victim reported losing her life savings and accumulating debts totaling £70,000 after falling victim to an investment scam. Additionally, numerous unsuspecting online shoppers recounted being deceived by fraudulent online shops promoted on Facebook and Instagram.
Particularly distressing were the experiences of victims targeted by the WhatsApp “Hi Mum” impersonation scam, where fraudsters impersonate family members to coerce them into sending large sums of money. Valerie, a 73-year-old victim, handed over £2,000 to someone posing as her son, a small business owner who had previously borrowed money. Struggling with long Covid, Valerie expressed that she would never recover from the humiliation of being deceived in this manner.
Earlier this week, TSB, a prominent UK bank, estimated that fraud from Meta’s platforms could lead to losses of up to £250 million for UK households in 2023. The bank reported significant spikes in fraud cases linked to Meta-owned sites and apps in 2022, accounting for 80% of the cases they encountered.
Many victims expressed difficulties reporting scams to Meta, often receiving automated responses or no response. Lucy Powell, the shadow digital, culture, media, and sport secretary, criticized social media executives for evading accountability for too long. She highlighted the government’s delayed and diluted inclusion of fraud and scams in the online safety bill, urging them to prioritize the interests of consumers and victims over vested interests.
The online safety bill in parliament aims to compel technology and social media platforms to remove fraudulent advertisements. The government’s new anti-fraud measures also include requesting tech firms to streamline fraud reporting and granting banks the ability to delay suspicious payments. However, the bill lacks provisions requiring tech platforms to compensate customers for fraudulent activities.
Burdened by the escalating refund costs, TSB, Barclays, Nationwide, and Starling Bank argue that Meta, a California tech giant with a $700 billion valuation, should contribute financially to these expenses. Meta generates substantial income from advertising, with Facebook’s UK operations alone reporting a 37% increase in gross income from advertisers in 2022, reaching £3.3 billion.
Barclays UK CEO Matt Hammerstein echoed the urgent need for action, emphasizing the epidemic nature of scams in the country. Barclays’ data revealed that 77% of scams occur on tech platforms, including social media sites and online marketplaces. Hammerstein advocated for tech companies to actively engage in the fight against fraud, suggesting that financial incentives might be necessary if voluntary actions prove insufficient.
Starling Bank labeled Facebook as the primary facilitator of fraud affecting its customers, closely followed by Instagram. In December 2021, the bank suspended all paid ads on Meta platforms to protest the company’s failure to address the problem effectively. Starling Bank expressed disappointment that banks bear sole responsibility for reimbursing customers, while the social media platforms where the fraud originates evade accountability.
Which?, a consumer group, conducted research revealing misleading and potentially fraudulent investment advertisements reaching Facebook and Instagram users. The