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Google and Facebook were grilled by a Parliamentary inquiry into economic crime with MPs furious the tech giants profit from scammers whose adverts can lead to victims being robbed of life savings
Google and Facebook have not compensated a single victim of the fraud adverts that appear on their platforms.
The shameful admission was laboriously extracted from senior figures from the online giants who were grilled by a Parliamentary inquiry into economic crime.
MPs on the Treasury Committee were furious that the firms profit from scammers who pay to place adverts that can lead to victims be robbed of their life savings.
Labour’s Rushanara Ali told Google that it was acting in a “frankly appalling way” and raised the prospect of new laws forcing it to stop carrying scam content, with fines for breaches.
How, she asked, did Google feel about that?
The company’s Director of Trust and Safety, Amanda Storey, spouted stuff about education and sharing the concerns, driving Ms Ali to demand: “Why do you not answer the question?”
Do you feel let down by Google and Facebook? Have your say in the comment section
Tory MP Anthony Browne was similarly stonewalled at last week’s hearing when he asked Ms Storey: “Will you compensate customers who are victims of fraud that is advertised by you?”
“We have a responsibility to deliver a safe experience on our services and we are investing heavily to make sure that we keep that experience safe,” she answered, or rather, didn’t answer.
Mr Browne didn’t let her get away with that.
“If somebody is put in touch with a fraudster through Google and they lose money as a result, will you compensate the customer 100%?” he persisted.
That got another non-answer: “We are working hard to make sure that we are never in a position where a user needs to be compensated.”
“Can you answer the question?” he pressed. “Have you ever compensated any customer who has lost money through fraud via Google?”
Finally he got the admission from Google: “We have not”.
Over to Facebook and its content policy director, Allison Lucas. Have they ever compensated a user who’s been scammed by a fraudulent advert on its site?
Ms Lucas claimed not to know.
“You do not know whether you have compensated any customers for losses that they have suffered as a result of your advertising?” said an incredulous Mr Browne.
Ms Lucas muttered something about tackling underlying issues.
Back to Mr Browne: “Can you answer the question? Have you ever compensated any customers for losses that they have incurred as a result of advertising on Facebook?”
She finally conceded: “I do not know that we have.”
Mr Browne also eventually got both companies to admit that they have no plans to compensate victims in the future, instead pinning their hopes on stamping out fraud.
That brought another scathing response from the MP.
“You are unlikely to eliminate it 100% because fraudsters are incredibly imaginative and agile, and there will still be people losing money, often livelihoods, as a result of advertising that Facebook, Google and others facilitate,” he said.
Mr Browne used to be the chief executive of the British Bankers Association and compared the motivation that banks have in fighting fraud with the lack of motivation at online firms.
“Banks know their fraud loss rates, because they compensate customers for fraud,” he said.
“They know how much it costs them and they have an internal financial incentive to reduce fraud as much as possible, so that they do not have to pay out for those losses.
“As companies, you have none of those internal financial incentives, and you profit from fraud. You profit from advertising fraud and you do not suffer any of the losses.”
When Ms Storey responded that “Bad ads are very bad for business” Mr Browne told her: “But you make money out of bad ads. You profit from them, and you profit from getting the regulator to advertise against the adverts that you promote.”
The chair of the committee, Mel Stride, also struggled to get straight answers when he repeatedly asked Google if it would reimburse the Financial Conduct Authority for the adverts it has felt obliged to take out to counter the ones placed by scammers.
Google has promised £1.5million in “ad credits” but, Mr Stride asked, would it get back the £600,000 it has already spent.
After one unhelpful reply he stopped Ms Storey mid-flow to say: “I am still not getting a direct answer to the question.”
And while some of the world’s richest companies duck and dive, lives are being destroyed by the online frauds they enable.
Bing
There were no witnesses from Bing at the Treasury Committee hearing, which was a shame, because it seems to be one of the worst offenders when it comes to enabling frauds.
Last week I put “compare best savings rates” into the Microsoft search engine and three of the top results were adverts for websites that should never have been promoted because they are on the consumer alert list published by the Financial Conduct Authority.
The first result, top-isacomparison.com, blatantly used meerkat branding stolen from Compare the Market.
It purported to be a savings comparison website promising returns of up to 5% but in reality was designed to get your contact details so you could be targeted by scammers.
A Compare the Market spokesperson said: “We take this issue very seriously and protecting our customers is our number one priority.
“We constantly monitor for activity that might be fraudulently using the Compare the Market brand and take action to remove anything that is as quickly as possible.”
Bing removed the scam ads after I contacted it, insisting: “We have numerous control measures to identify advertisements that do not comply with our policies and terms of services and are continually working to improve our tools.”
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