Some of the UK’s largest banks – Barclays, TSB, Lloyds, and Santander – are reportedly demanding that Facebook, Google, and telecom firms compensate the victims of scams on social media.

The banks say that BigTech businesses are not paying their fair share amidst the rising levels of digital fraud in Britain, according to a report by The Telegraph.

The four organisations are supporting a “polluter pays” principle which would force companies like Facebook to contribute to a collective reserve of funds for victims of online scams, said the newspaper.

Currently banks are operating under a voluntary reimbursement code which was launched in May 2019.

Last year consumer organisation Which? claimed that less than half of bank transfer scam losses have been compensated under the scheme.

Social media brands like Facebook and Instagram, alongside Google, and telecom companies, do not currently pay any compensation to victims of fraud.

The report says that research from Barclays found that over 75 per cent of online scams occur on social media, auction sites, or dating apps.

£583 million was lost by victims of authorised push payment (APP) fraud in 2021, an increase of over 25 per cent compared to the previous year, according to figures from UK Finance.

“We would like to see a cross-sector pot funded by a polluter pays principle,” wrote Sian McIntyre, head of economic crime at Barclays for The Telegraph. “Those companies that enable scams on their platforms or services should be putting money into that pot.”

McIntyre added that text messages sent by online criminals are enabled by telecom providers and if a fraudulent link is clicked on by a victim this is facilitated by an internet provider.

“If a customer clicks on a criminal advert on social media this will be hosted by a tech firm and when the victim parts with their funds their bank should attempt to block transactions,” explained the banking executive. “All companies and sectors involved in enabling scams should be mandated to regularly publish their data, including what action they are taking, and contribute to victim compensation.”

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