ISBA backs plan to force tech giants to block scam ads

Client marketing body ISBA has throw its weight behind new Ofcom plans to force tech giants to finally be held accountable for tackling scam ads on their platforms.

Proposals on tackling paid-for scam ads further implement the Online Safety Act and will apply to some of the UK’s most widely used sites and apps, including social media and search platforms, in line with criteria set by the Government.

More than £40bn a year is spent on digital advertising across the UK, making up the majority of the revenue earned by the tech giants selling the ads.

However, according to a study by Juniper research, the UK leads Europe when it comes to victims of fraudulent ads, with nearly 11% of the total European revenue from the practice coming from ads targeted to a British audience.

In Europe, social media firms profited around £4.4bn last year from scam ads targeting their user base, with fraudulent ads running wild across Facebook, Instagram, and X.

The issue is pervasive, as around 10% of all social media advertising profit in Europe stems from fraudulent ads, with bogus recommendations from the likes of Richard Branson and Martin Lewis (pictured) often being used to lure in unsuspecting victims.

Ofcom, and many others, believe tech firms have not done enough to protect people from cybercriminals who use their platforms.

Ofcom’s own research shows over half (51%) of adults have encountered potentially fraudulent ads online, with over a third (36%) seeing them frequently. An estimated total of over £200m is lost by victims to these kinds of scams in the UK on average each year.

Ofcom’s draft Fraudulent Advertising Code means tech giants will for the first time be legally required to put robust measures in place to address scam advertising.

The draft code sets out nearly 40 new practical measures for how major platforms should protect their users from falling victim to scammers.

Once approved by Parliament, the code will come into effect and companies who fall short can be subject to enforcement action – including fines of up to £18m or 10% of global revenue, whichever is greater.

ISBA director of media Steve Chester said: “From ‘ads’ impersonating well-known brands and damaging their reputation, to click fraud distorting the targeting of ad campaigns and ruining results, fraud is a major concern for advertisers – so it’s very welcome that Ofcom has announced that it is taking action.

“We know that fraud is the most prevalent crime in the UK. With digital advertising so essential to advertisers’ marketing mix, proportionate regulation of tech platforms to help tackle the problem is the right thing to do. We hope that Ofcom’s proposed measures will be swiftly considered and, wherever possible, adopted.

“It’s also welcome to see Ofcom acting to give users more control over the types of content they see. User and brand safety are an absolute priority for advertisers, who want a healthier online environment. The clear expectation from policymakers and regulators – and from advertisers – is for more to be done to tackle online harms.”

The consultation closes on October 2, and final decisions will be published next year.