Social networking sites and search engines may soon have to stop fraudulent paid ads from appearing by law.
The updated proposal is part of the Online Safety Bill, landmark legislation that tries to determine how sites handle harmful content.
Campaign groups say being the victim of a scam can cause financial and emotional devastation.
The government is also launching a consultation on how online advertising is regulated.
Under a new legal duty being added to the bill, platforms will need to implement processes to block ads that appear online and remove them if they slip off the network.
The idea is intended to better protect people from scams in which criminals pose as celebrities or businesses to steal personal data, sell unsafe financial investments or access bank accounts.
Culture Secretary Nadine Dorries said: “We are also announcing a review of the wider rules on online advertising to make sure industry practices are responsible, transparent and ethical, so people can trust what they do. they see advertised and distinguish fact from fiction.
Martin Lewis, who founded Moneysavingexpert.com, and the consumer group Which? both welcomed the news: they had called for scams to be included in the bill.
Lewis described an “epidemic of scam ads” and added: “Scams not only destroy people’s finances, they affect their self-esteem, their mental health and even cause some to consider taking their own lives.”
“Having the government now accept the principle that fraudulent advertisements must be included and that the companies that are paid to publish advertisements must be held accountable for them is a crucial first step.”
“Until now, only user-generated scams were covered, which risked driving more fraudulent ads, incentivizing criminals to change strategy.”
But the consumer advocate believes the scope of the bill could be broader.
“We need to analyze and examine this update, one of my concerns is that it appears that the display advertising you see on third party websites is not within the scope of the bill when it comes to fraudulent ads.”
Anabel Hoult, Which? The CEO added: “This could make a huge difference in stemming the tide of fake and fraudulent ads on social media and search engines that cause devastating financial and emotional harm to innocent victims.
“The online safety bill must now ensure that the regulator has the support and resources it needs to hold businesses to account and take strong enforcement action where necessary, to prevent fraudsters from using advertisements to lure unsuspecting victims”.
Separately, the government is launching a consultation on proposals to tighten rules for the online advertising industry.
Social media influencers could face harsher penalties for failing to report correctly when they are paid to promote products online.
Hashtags that include “#ad” or “#spon” are often used in posts, but studies suggest some Instagram stars don’t adhere to the rules.
Harmful or misleading ads, such as those that promote negative body images, could also be subject to stricter rules, but exactly how has not yet been resolved.
Communications regulator Ofcom will set out more details on what platforms will need to do to fulfill their new duty in codes of practice.
It could involve identity checks for those posting ads and ensuring that financial promotions are only carried out by official companies.
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