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For the first time, social media platforms like Meta and TikTok will be legally responsible if users fall victim to financial scams, following a deal reached by EU lawmakers in the early hours of Thursday.
After eight hours of negotiations, according to Politico, the European Parliament and Council agreed on new rules aimed at tightening safeguards against payment fraud, a move that adds fresh regulatory pressure on U.S. tech giants already under scrutiny for anti-monopoly and content moderation rules in the EU.
“This is a big win. A big, big step forward,” said Danish MEP Morten Løkkegaard, who helped shepherd the package through Parliament. “We are coming from a reality where platforms are not liable under any law. It is a historical moment.”
The rules create a shared responsibility between banks and social media companies. Banks must reimburse customers if their security systems fail or if a payment is processed without consent. Meanwhile, social media platforms will have to compensate banks if they ignore reports of scams on their sites.
Lawmakers see the measure as crucial as financial scams increasingly exploit social engineering and AI tools. “We are seeing an unprecedented rise in scams,” said Lithuanian MEP Virginijus Sinkevičius.
The new rules expand on the EU’s Digital Services Act and Digital Markets Act, which already regulate illegal content and limit the reach of dominant online platforms. Violations can carry heavy fines, a point that has drawn fire from the tech sector and U.S. officials.
“This convoluted framework undermines simplification efforts and ignores warnings it will be counterproductive,” said Leonardo Veneziani of CCIA Europe, which represents Amazon, Google, Meta, and Apple. “Instead of protecting consumers, it sets a dangerous precedent and shifts responsibility away from those best placed to prevent fraud.”
The agreement marks a major shift in the EU’s efforts to hold tech companies accountable, signaling that the era of platforms operating with near-total immunity may be coming to an end.
