EU to launch scam crackdown

The European Union is officially kicking off a scheme designed to tackle scammers, but does the UK have the skills to help?
Written by Tom Espiner, Contributor on

The European Union will officially launch a crackdown on cross-border scams, including internet fraud, this week.

The scheme, called the Consumer Protection Cooperation Network, is an Europe-wide network designed to help law-enforcement bodies tackle crooks who defraud victims in one country while operating in another. It has been created under the auspices of European legislation called the Consumer Protection Cooperation Regulations, which was passed in 2004.

This network of consumer protection watchdogs has been in operation since 29 December, 2006, but will be launched officially in Brussels on Wednesday by the EU commissioner for consumer affairs, Meglena Kuneva.

"Con artists are using mass emails or false promises of big earnings to trap vulnerable people," Kuneva said in a statement. "The fraudsters are clever — taking advantage of different legal systems across the EU to target vulnerable people. Their crafty schemes, such as personalising letters and making them look professional, are costing European consumers millions of euros."

"In the UK alone, over three million adults fall victim to scams each year, costing each one an average of €1,500 (£1,000)," Kuneva claimed. "This kind of malicious practice has to stop. The new EU-wide network of national watchdogs will help to stop unscrupulous traders in their tracks, by ensuring that they can no longer evade consumer protection authorities."

The Office of Fair Trading (OFT), which is the UK's national consumer protection authority, welcomed the establishment of the EU scam-busting network. Earlier this month the OFT launched its 2007 Scams Awareness Month to raise consumer awareness about increasingly sophisticated techniques used by scammers. These techniques include spam emails, texts and internet pop-ups. According to recent research carried out by the OFT, they cost UK consumers around £3.5bn each year.

However, in January the OFT admitted that it suffers from a lack of both resources and staff with the necessary technical skills to tackle the full range of internet scams. Mike Haley, the head of the OFT Scambusters team, told a House of Lords Science & Technology inquiry that his team's expertise lay in dealing with "real world" trading scams, rather than online fraud.

"We have a lack of skilled and competent investigators in the area to make a dent in email and internet scams," Haley told the Lords Science & Technology Committee, which is currently investigating internet security in the UK. "We need spam-related enforcement," Haley added.

The Consumer Protection Cooperation Regulations established minimum standards for national enforcement authorities, including the ability to conduct on-site inspections, impose fines and order companies to cease illegal practices. The OFT was unable to comment at the time of writing as to whether the regulation would allow it to seize computing equipment used by spammers, which previously it had no powers to do.

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