Britain to crack down on online fraud after LCF collapse
Huw Jones, 21 April 2021
Britain will crack down on online scams and make platforms that make money from advertising financial products more accountable, financial services minister John Glen said on Wednesday.
A report into the collapse of London Capital & Finance investment firm recommended that the government should consider including financial fraud in its proposed law on online safety. LCF was authorised by the Financial Conduct Authority but the mini-bonds it sold online were unregulated.
The government said on Monday it would pay up to 120 million pounds in compensation to many of the 11,600 investors who lost up to 237 million pounds when the fund collapsed in early 2019. The Serious Fraud Office is investigating the collapse.
Scrutiny ahead of the proposed online law will give the finance ministry an opportunity to see if financial fraud could be fitted into it, Glen told a hearing of parliament’s Treasury Select Committee on the report into LCF’s collapse.
The report exposed the challenge that so many financial services products are marketed online, Glen said.
The safety bill will introduce new rules to make companies based anywhere in the world take responsibility for the safety of their online users in Britain from harm like child sexual exploitation, terrorism, hate crime and sale of illegal weapons and drugs.
