Starling Bank’s Anne Boden has said she is “disappointed” by the government’s decision to omit online fraud from the Online Harms Bill.

The chief executive and founder of the challenger bank said that she hoped it was “not too late” to change the bill to include online fraud.

The legislation, which is set to come into force early this year, will involve a new regulatory framework for online safety that will "make clear companies’ responsibilities to keep UK users, particularly children, safer online with the most robust action to counter illegal content and activity."

She called for better collaboration between banks and social media sites to help address the issue.

“Banks invest billions to tackle economic crime, but we cannot stop it on our own,” she explained. “We need the cooperation of other industries, particularly the social media platforms and telecoms networks that are abused by criminals for the express purposes of financial crime.”

According to UK Finance there are thousands of social media accounts in operation by criminals at any one time, and they are often involved in online fraud.

“In this context, banks seem to have become the underwriter of all kinds of fraud that are not really financial fraud at all,” said Boden, who set up her mobile-only bank in 2014. “If a consumer buys a pair of trainers online from a site advertised on a social media platform that takes their money and runs, this is not financial fraud, it’s purchase fraud."

She added: “Yet the banks are the ones asked to repay the customer for the non-existent trainers, while the social media platforms the fraudsters advertise on do nothing. Criminals wouldn’t be allowed to advertise on traditional media with such impunity.”

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