BoE's Bailey 'wants government action' on online fraudsters

Lucy Harley-McKeown
·2-min read
Chief Executive of the Financial Conduct Authority Andrew Bailey speaks at a press conference at the Bank of England in London, Britain February 25, 2019. Kirsty O'Connor/Pool via REUTERS
Andrew Bailey speaks at a press conference at the Bank of England in London, Britain February 25, 2019. Photo: Kirsty O'Connor/Pool via REUTERS

The Bank of England's (BoE) governor has lobbied the government to bring in legal requirements for internet companies like Google (GOOGL) to remove financial fraud websites.

The Sunday Times said, citing sources, that Andrew Bailey has been lobbying home secretary Priti Patel on the issue, calling for measures against financial crime to be added to the Online Harms Bill.

A proliferation of get-rich-quick schemes, scams, some involving digital currencies, and dupes of normally reputable websites has seen many lose money. Internet companies such as Google profit from these kinds of fraudsters that pay for top spots in search results.

Since the COVID-19 pandemic hit the UK online fraud has surged. Action Fraud, the UK's reporting agency, said £78m ($108m) was lost on fake investment websites, with victims losing £45,242 on average in 2020. This doesn't take into account the fact that many cases of online fraud go unreported, meaning that number could be significantly higher.

The legislation is expected to be put before parliament later this year and has been in the works for some time. Earlier this month Jeremy Wright QC, the author of the white paper for the bill, said it was not moving as fast as he would like, and the government should be acting with "urgency." The current remit of the bill is more geared towards terrorism and child grooming, rather than financial fraud.

The government has planned to make Ofcom the regulator of the bill, giving them the power to fine internet companies up to 10% of their turnover for failures over illegal posts or content that is "harmful."

A BoE spokeswoman told Yahoo Finance UK the central bank did not comment on private meetings or comments made by unnamed officials and therefore would not say whether Bailey had spoken to Patel about the issue or not.

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She said that the governor has already been on the record on several occasions saying that the Online Harms Bill should be extended to cover financial services.

Google says it takes down scam websites when notified, and has in the past blamed poor guidance from regulators for difficulties in implementing rules about fraud.

Watch: Scammers thriving under lockdown