Social media has become rife with financial scams, and MEPs pushed hard to hold both Big Tech and banks liable during legislative negotiations. EU governments, meanwhile, believed banks should be held responsible if their safeguards aren’t strong enough.
As a compromise, lawmakers agreed that banks should reimburse victims if a scammer, impersonating the bank, swindles them out of their money, or if payments are processed without consent.
But social media companies will have to compensate banks if it’s clear that they failed to remove an online scam that had been reported.
Some MEPs had called for more amid concerns that EU consumer safeguards on social platforms have proven insufficient. “Especially, as AI and social-engineering fuel an unprecedented rise in scams,” said Lithuanian Greens lawmaker Virginijus Sinkevičius.
The new rules build on the EU’s Digital Services Act and the Digital Markets Act, which respectively limit the spread of illegal content and prevent large online platforms, such as Google, Amazon and Meta, from overextending their online empires.
Breaching the DSA and DMA can come with huge fines, triggering pushback from the tech sector and U.S. President Donald Trump, who has accused the EU of discriminating against American companies. U.S. Secretary of Commerce Howard Lutnick has threatened to keep 50 percent tariffs on European exports of steel and aluminum unless the EU loosens its digital rules.