Social media companies to be held liable for financial scams under new EU rules

"After hours of late-night negotiations, EU lawmakers approved the measure, adding another layer of regulatory pressure on companies that have spent years lobbying Washington to counter the EU's aggressive antitrust and content-moderation agenda. The law builds on the Digital Services Act (DSA) and Digital Markets Act (DMA), which curbs the spread of illegal content and prevent tech giants like Google, Amazon, and Meta from leveraging their dominance to expand across the internet."

"Much of the final stretch of deliberations centered on who should shoulder the blame when these scams happen. Several MEPs argued that Big Tech and banks share equal responsibility, since platforms host the scams and banks process the money. However, European governments pushed back, arguing that banks should only be held accountable when their own safeguards fail."

European Union lawmakers approved a law that holds social media platforms like Meta and TikTok liable for financial fraud. The measure expands regulatory reach beyond existing Digital Services Act and Digital Markets Act provisions to curb illegal content and restrain platform dominance. Violations of the DSA or DMA can trigger massive fines, which prompted pushback from major tech firms and objections from some U.S. political figures. Final negotiations focused on assigning responsibility between platforms and banks, producing a compromise that limits bank accountability to cases involving failed safeguards or impersonation, with reimbursement rules established accordingly.

Read at Mashable