Two senators have introduced bipartisan legislation directing social media companies and other online media providers to take steps to fight fraudulent advertisements on their platforms. The American Bankers Association supports the legislation.
The Safeguarding Consumers from Advertising Misconduct, or SCAM, Act by Sens. Bernie Moreno (R-Ohio) and Ruben Gallego (D-Ariz.) would prohibit online platforms from displaying fraudulent or deceptive commercial advertisements. It would require companies to take additional steps to prevent scam ads from appearing on their platforms, such as by giving users better tools to report fraud.
The bill also would strengthen the Federal Trade Commission’s and states’ ability to enforce violations of consumer protection laws.
In a statement, ABA President and CEO Rob Nichols called the SCAM Act a critical step forward in the nation’s fight against fraud.
“Millions of Americans lose billions of dollars a year to scams that start on social media platforms,” Nichols said. “Banks of all sizes invest significant resources to detect and stop fraud, and Americans appreciate those efforts, but we need to prevent scams before they ever reach a bank.
“The SCAM Act simply asks social media companies to put consumers first by taking responsible steps to remove scammers from their platforms,” he added. “Protecting Americans from fraud should be a bipartisan, national priority, and ABA encourages all lawmakers to join Sens. Gallego and Moreno in supporting the SCAM Act and sticking it to the scammers.”
