The House of Commons Treasury Select Committee has quizzed expert witnesses on online financial crime as part of its ongoing inquiry into economic crime.
The inquiry is assessing progress made in combatting economic crime since a previous inquiry held between 2017 and 2019. It is focusing particularly on anti-money laundering systems and the sanctions regime, and how consumers are affected by economic crime.
The committee has held four evidence sessions this year, including most recently a session focusing on online platforms in September. The committee heard evidence from experts including from technology giants eBay, Facebook and Google who focus on protecting consumers and users of online platforms.
The witnesses said they were working with regulators such as the Financial Conduct Authority in a bid to tackle fraudulent advertising and other scams. They told the committee retail, customer support and recruitment fraud had risen in recent years, carried out by “sophisticated individuals and organised crime”.
Laura Gillespie
Partner
Understanding how technology can be used to perpetrate economic crime will educate policymakers on how to tackle the threat
The companies said they had not waited for regulation, such as the Online Safety Bill which is currently before Parliament, to tackle the problem. They said privacy concerns for their users were a challenge when it came to sharing information with each other, although they did share data on fraud and cybercrime with law enforcement agencies.
The witnesses said they worked both “proactively and reactively” using policies and technology to protect users and combat cybercrime, but they acknowledged their systems were imperfect and some fraudulent advertising, for example, would still get through.
Cybercrime expert Laura Gillespie of Pinsent Masons, the law firm behind Out-Law, said the UK government’s economic crime plan 2019-22 highlighted the ongoing challenge of aligning economic crime governance with broader cybercrime governance.
“Evidently, many frauds are facilitated through online technology. Understanding how technology can be used to perpetrate economic crime will educate policymakers on how to tackle the threat. With the explosion of ransomware in the last few years, pressure is building to find a way to deter and disrupt the cyber criminals’ financial model whether through enhanced sanctions, further regulation or both,” Gillespie said.
The previous inquiry culminated in a report which contained a number of recommendations for the UK Government to consider, mainly related to strengthening enforcement powers post-Brexit. A similar report with non-binding recommendations for the Government will be the likely output from the current inquiry.
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