Starling boss Anne Boden has called on the UK government to reverse its decision not to include financial fraud in its new 'Online Harms' bill, arguing that banks "seem to have become the underwriter" of all kinds of fraud, giving other players, such as social media platforms and telcos, a free pass.
The Online Harms bill aims to force firms - through the threat of massive fines - to improve internet safety in areas such as terrorist content, child sex abuse, hate crimes, cyber-bullying and the dissemination of fake news.
However, despite calls from campaigners and UK Finance, financial fraud has not been included in the bill.
In a blog, Boden says she is "disappointed" by the omission, adding "I hope it's not too late to change this".
Boden argues that while banks are investing billions in tackling crime, they cannot do it alone. She calls for greater cooperation from other industries, specifically social media and telecoms, which are used by crooks to dupe victims.
She cites UK Finance claims that thousands of social media accounts are being operated by criminals to advertise for ‘money mules’, sell stolen identity and credit-card data, carry out phishing, and push bogus investment scams and impersonation fraud.
Says Boden: "In this context, banks seem to have become the underwriter of all kinds of fraud that are not really financial fraud at all. 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.
"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."
Boden's comments come as an investigation from consumer watchdog Which? finds "serious vulnerabilities" in security at several major bank websites - although Starling managed to come out top of the table.