Revolut CEO Nikolay Storonsky (L) and Meta CEO Mark Zuckerberg.
Reuters
British financial technology company Revolut criticized Facebook parent company Meta on Thursday for its approach to tackling fraud. It says the US tech giant should directly compensate people who fall victim to scams on its social media platforms.
A day after Meta announced a partnership with British banks NatWest and Metro Bank on a data-sharing framework designed to prevent customers from falling prey to fraud schemes, Revolut said the pact “falls woefully short of what is needed to tackle fraud globally.”
In a statement, Woody Malouf, head of financial crime at Revolut, said Meta’s plans to tackle financial fraud on its platforms amount to “baby steps, when what the industry really needs is giant leaps forward.”
“These platforms share no responsibility in reimbursing victims, so they have no incentive to do anything about it. An obligation to share data, even if necessary, is simply not good enough,” Malouf added.
CNBC has contacted Meta for comment.
New payments sector reforms will come into effect in Britain on October 7, requiring banks and payment companies to award victims of so-called Authorized Push Payment (APP) fraud a maximum compensation of £85,000 ($111,000).
The UK Payments System Regulator had previously recommended a maximum compensation amount of £415,000 for fraud victims, but backed down after backlash from banks and payment companies.
Revolut’s Malouf said that while his company is cooperating with the steps the UK government is taking to combat fraud, Meta and other social media platforms should do their part to financially compensate those who fall victim to fraud as a result of scams from their sites. .
The fintech company published a report on Thursday claiming that 62% of user-reported fraud on the online banking platform came from Meta, compared to 64% last year.
Facebook was the most common source of all scams reported by Revolut users, responsible 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’..“