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Goldman-backed digital financial institution Starling has boycotted Meta for fraudulent promoting

The Facebook and Instagram logos displayed on a smartphone with the meta platform logo in the background.

Igor Golovniov | SOPA pictures | LightRakete | Getty Images

LONDON – UK digital bank Starling says it is boycotting Facebook parent company Meta for failing to tackle fraudulent tombstones.

Anne Boden, CEO and founder of Starling, said her company will no longer pay for advertising on Facebook and Instagram while scammers target their customers.

In an annual letter published on Thursday, Boden said, “We want to protect our customers and our brand integrity. And we can no longer pay to advertise on one platform alongside scammers who are after the savings of our customers and those of other banks. "

Boden has put pressure on the UK government to tackle financial fraud in the Online Safety Bill, a comprehensive package of legislation aimed at combating the spread of harmful content on digital platforms.

The Online Safety Act would put due diligence on big tech companies like Meta and Google, and require them to take action against harmful and illegal material. Companies that fail to do so risk fines of £ 18 million (US $ 24 million) or 10% of their annual global sales, whichever is greater.

Last month, a committee of lawmakers examining the bill recommended that the new legislation cover fraud allegations. The UK's Financial Conduct Authority has already sounded the alarm over advertising for investment fraud. These include, for example, cryptocurrency scammers who use pictures of celebrities to scam consumers.

In August, Google won't accept ads for financial services unless the advertiser has been authorized by the FCA or qualified for certain exemptions. Meta committed to tightening its financial promotion guidelines in December, but the company has yet to implement those changes. Meta expects to do so later this year.

"Promoting financial fraud is against our policy and we are devoting significant resources to addressing this industry-wide problem on and off our platforms," ​​a meta-spokesperson told CNBC.

“To combat this, not only are we working to detect and reject fraudulent ads on our services, but we are also blocking advertisers. While no enforcement is perfect, we continue to invest in new technology and methods to protect users of our services from these scams. "

Meta already has policies outlawing the promotion of financial fraud, such as loan fraud and programs that promise high returns. And the company says it bans ads that promise unrealistic results or guarantee a financial return.

Boden also aimed to rename Facebook Meta and its pivot point to what is known as the "Metaverse," a shared virtual reality where users can interact with one another.

“When I read that Facebook's next big project, the Metaverse, is likely to be the main driver of growth in finance and DeFi (decentralized finance) in the 2020s and beyond, I know that this is likely both wrong and right . “, She quoted an attempt by a bank to advise its customers in the much-vaunted virtual world of Second Life.

Second Life, which did not have much success, is now viewed by some as the forerunner of the metaverse.

"While Facebook (meta) holds all possible promises for the future, I really hope its focus on the metaverse doesn't detract from doing the right thing, here and now in the UK by 2022," added Boden.

Starling was founded in 2014 and has grown to become one of the UK's largest digital banking brands with a customer base of 2.7 million. With 475,000 business accounts, the company also controls 7% of the UK commercial banking market.

The bank counts Goldman Sachs, the Qatar Investment Authority and Fidelity as investors and was most recently valued at $ 1.5 billion. Its competitors include Revolut and Monzo, most recently privately valued at $ 33 billion and $ 4.5 billion, respectively.

Boden's attempt to pressure Meta to crack down on online fraud follows mass boycotts of major brands that temporarily paused advertising on Facebook in 2020 for not doing enough to censor hate speech.

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