UK Government to Ban Digital Assets Related Cold Calls

The statistics on frauds and scams in the UK grew in the past few years, and frauds accounted for over 40 per cent of the crimes that caused a loss of nearly £7 billion a year to the country. 

Most such crimes are committed easily through digital tools and techniques, and it is hard to police, so there is a need to impose strict laws to handle such crimes. 

According to the blockchain and smart contract security firm Certified Kernel Tech (CertiK), digital asset-related exploits and hacks led to a loss of $103 million in April 2023, down from $211 million in the previous month of 2023. On May 3, the UK government announced a blanket ban on cold calls selling financial products, which include digital assets. 

The ban covers legitimate calls and scams; anyone who gets calls from those trying to sell the products will know it is a scam.

Plan An Outlaw Sim Farms

To Address financial fraud and scams, the UK government introduced the ban on cold calls and plans to outlaw SIM farms, devices that allow criminals to scam texts. In addition, the authorities plan to crack down on number spoofing. 

The scammer impersonates UK numbers and tricks others into thinking they are speaking to a legitimate representative of a financial organization. 

The National Fraud Squad, the National Crime Agency, and the City of London Police and the construction of the state-of-the-art reporting centre that will run in the year will affect the new rules and measures concerning fraud data. 

Frauds continue to grow yearly, and 1 in 15 people is falling victim to such crimes. In the last summer, over 41 million were targeted by such messages and calls (as per the data of media regulator Ofcom). 

After the announcement of the new regulations enforced in the summer, most marketers and businesses are trying to see what will be covered under it, like the sim farms will be banned because it allows people to use multiple sims and send bulk messages. 

In addition, the investigation agencies and police will also collaborate with overseas agencies to shut down the call centres that send fraud messages or make such calls. 

Most advertising campaigns will be obliged to warn people of the risks involved, and new measures will be introduced to tackle phone spoofing. 

The measures aim to target organized crime and terror groups responsible for ruining the lives of many unaware clients who lost their lifelong savings to such frauds. Even large and small businesses and government agencies have penalized the vulnerable people who suffer fraud, but they cannot bring fraudsters to justice.   

There are many cases where scam artists can cause devastating effects as they cruelly target pensioners' funds, and most funding and reimbursements offered by the government fail to tackle the scale of the issue. 

Cold calls offering pension products are illegal, and the new announcements extend the authorities' powers where people who are most targeted, like those with health issues like dementia, will get warnings with any such bogus cryptocurrency schemes or insurance plans. 

Unsolicited calls will be covered by the new rule to stop scammers from selling fake insurance or cryptocurrency plans. The new fraud squad will have 500 staff, up from 120. The consumer groups said this was a welcome step, but the big tech platforms should be held liable, and the government must take serious steps to handle fraud in their online venues. 

Technological developments present new ways for criminals to target unsuspecting clients who pose as legitimate businesses, or they may pose as someone you know and text messages to extract funds from the target. 

The government plans to tackle text farms that send thousands of fraudulent texts in the name of trusted brands. The common scams start from messages sent from authorized organizations like Royal Mail seeking a delivery review, or from a financial organization like a reputed bank, or a message asking someone to transfer funds to another account. 

The government claims the frauds caused a loss of nearly £7bn per year, and around 90 per cent of internet users encountered online scams.