CEO of Revolut, Nikolai Storonsky (L) and CEO of Meta, Mark Zuckerberg.
Reuters
British financial technology firm Revolut on Thursday criticized Facebook’s parent company Meta for its handling of fraud, saying the US tech giant should directly compensate people who fall victim to social media scams.
After a day Meta announced a partnership with UK banks NatWest and Metro Bank on a data-sharing framework designed to help prevent customers from becoming victims of fraud schemes, Revolut said the agreement “falls far short of what is needed to tackle global fraud.”
In a statement, Woody Malouf, head of financial crime at Revolut, said Meta’s plans to tackle financial fraud on social media amount to “baby steps, when what the industry really needs is a leap forward.”
“These platforms do not share the responsibility in restoring the victims, so there is no incentive to do something about it. The commitment to share data, although necessary, is not enough,” added Malouf.
A Meta spokesperson told CNBC that its bank intelligence sharing framework “is designed to enable banks to share information so we can work together to protect the people who use our services.”
“Fraud is a multi-sectoral issue that can only be solved through cooperation,” the spokesperson said via email. “We encourage banks including Revolut to join this effort.”
New payments industry reforms will come into effect in the UK on October 7 requiring banks and payment companies to pay victims of so-called authorization fraud (APP) a maximum compensation of £85,000 ($111,000).
Britain’s Payments System Regulator had previously recommended a maximum compensation of £415,000 for fraud victims, but backed off following a backlash from banks and payment companies.
Revolut’s Malouf said that, while his company is busy with the UK government’s anti-fraud measures, Meta and other social networks should do their part to financially compensate those who become victims of fraud due to scams on their sites. .
The fintech company published a report on Thursday that said 62% of fraud reported by users on its online banking platform came from Meta, down from 64% last year.
Facebook was the most common source of all scams reported by Revolut users, accounting for 39% of fraud, while WhatsApp was the second highest source of such events with an 18% share, the bank said in its “Consumer Security and Financial Crime Report” ..“
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