The UK’s Payments Association Wants the New Government to Make Social Media Giants Refund Fraud Victims

As the UK launched its General Elections earlier today, the country’s payments group, The Payments Association, urged the upcoming government to impose a ‘Tech Levy’ on social media giants. Essentially, the group wants the future Chancellor to make social media giants refund those who fell victim to scams originating on their social platforms.

Big Tech Firms Should Compensate Froud Victims, Says The Payments Association

According to the Payments Association, Big Tech firms should be held responsible for not preventing scams and as such, should be forced to compensate the victims of scammers who used social media sites to defraud others. This is known as the polluter pays principle, and it is not the first time that the lobby group has been demanding the implementation of reimbursement rules.

The group wants the rule set to be introduced by the Payment Systems Regulator, which has set a maximum mandatory refund by banks for APP fraud victims to 415k GBP.

Meanwhile, the Payments Association demands the threshold to be substantially reduced to a maximum of £30,000.

To achieve its goals, the Association called for the appointment of a dedicated Anti-Fraud minister, who would coordinate cross-departmental activities to make sure all involved parties would carry some responsibility for the threat of fraud, which continues to evolve.

Current reports suggest that the Labour Party is on course for a rather overwhelming victory in today’s polls. Some of the draft plans from the left-leaning party suggest that it views the PSR’s rules to be unsustainable and unfair. They also suggest that the party agrees that tech firms should shoulder the burden of compensating those who fall victim to fraud on social media.

The Payments Association Addresses The Future Chancellor

The Payments Association wrote a letter to the incoming Chancellor, calling for several moves. The first one is the publication of an ambitious, whole-ecosystem National Payments Vision and Strategy document, followed by the adoption of legislative measures that would lead to the creation of a new digital asset ecosystem and embrace Web3, DeFi, and smart contract standards. Finally, it called for the delivery of the next phase of open banking and open finance.

Commenting on the situation, the Payments Association’s director general, Tony Craddock, stated that a clear vision and strategy are expected from the new Government. If it manages to deliver, it will generate major investment and promote the UK’s position as the global payments leader.

He also added: “We especially hope the Chancellor sees the benefits of lowering the threshold for mandatory reimbursement of an APP fraud claim and potentially introduce a dedicated Anti-Fraud Minster. The current landscape is all too easy for fraudsters to navigate and the PSR’s proposed changes to will only serve to exacerbate the situation. Swift action as proposed in our letter is necessary to mitigate the potential threats once the changes are introduced on October 7th.”