Two Government departments have clashed over a plan to pressure tech giants to stop fraudsters using social media platforms to advertise investment scams, with some senior staff concerned it might harm Ireland’s relationship with US multinationals.
Officials in the Department of Enterprise raised “serious concerns” about a Department of Finance proposal for new rules limiting who can promote financial investment opportunities online, internal emails show.
Enterprise officials warned their finance colleagues the suggested changes would be bad for business and potentially conflict with the Republic’s position as a destination of choice for many Big Tech players in Europe.
The Department of Finance had proposed tech companies be made to vet those who post adverts promoting financial investment schemes on Facebook, Instagram, X, Google, TikTok and other platforms, in an effort to cut off scams defrauding people.
READ MORE
Tech firms would have to verify that those placing adverts for investments on their sites are genuine financial service providers registered with the Central Bank.
The proposal was put forward late last year during negotiations in Brussels to update EU regulations governing financial payments.
Typical online scams use images or deep fake videos of Irish politicians and celebrities to promote schemes promising huge financial returns, when in reality they are tied to sophisticated operations to steal people’s savings.
The adverts are linked to professional scam centres, usually based in eastern Europe, that deceive individuals into making payments they believe are for legitimate financial investments.
Internal emails show the Department of Enterprise told finance colleagues they had a “major issue” with their proposal to tackle the problem. The suggested reforms would hurt Ireland’s economic competitiveness and potentially clash with the EU’s existing digital regulations, officials said. “I have serious concerns about the current proposal,” one high-ranking civil servant wrote in a March 14th email.
[ Social media platforms need to be ‘accountable’ for scam adverts, PayPal saysOpens in new window ]
The Department of Enterprise official said Minister for Finance Paschal Donohoe had noted “the connection between our regulatory environment and the important role the technology sector plays in our economy”, in particular the jobs and investment created by “large, foreign-owned technology firms”.
The official warned the Department of Finance against going further than existing EU rules on tech firms required. The differing levels of tech regulation on either side of the Atlantic has “taken on a greatly elevated political prominence in recent weeks”, the official said.
Brussels regulations of US tech multinationals are a particular source of frustration for US president Donald Trump, who wants the EU to scrap guardrails it has put on the online sphere.
Correspondence revealing the inter-departmental fight was obtained by The Irish Times following Freedom of Information Act requests.
In an earlier email, Department of Enterprise officials said they opposed reforms that would create uncertainty for businesses.
The November 28th, 2024, email said the fact Ireland is responsible for enforcing EU digital and data rules for multinational companies with European headquarters in the country is “greatly valued” by tech firms “due to the regulatory certainty it provides”.
[ Irish people among international scammers’ most sought-after targetsOpens in new window ]
The enterprise official said that is an important part of the value Ireland offers when attracting foreign direct investment.
“Any erosion of this would be a concern and contrary to Ireland’s digital agenda and competitiveness of the EU,” the correspondence to finance officials said.
The wider update of EU financial regulations, through which Irish finance officials proposed the tougher rules cracking down on online scams, is still being debated in Brussels.
A Department of Finance spokeswoman said it has, “where appropriate, consulted with and taken into account the position of the Department of Enterprise” when making submissions to EU-level talks. The department cannot comment further while negotiations in Brussels were ongoing, she said.
