The UK Government’s Communications Data Bill (aka Snooper’s Charter) represents a serious threat to the country’s burgeoning fintech sector and is an alarmingly ill conceived response to alleged security threats.
The Conservative led Government has come back from this year’s election with renewed interest in the Snooper’s Charter with its inclusion in the Queen’s Speech in May 2015 and a further broadening of its powers.
The bill will introduce “backdoors” into encrypted transmissions, providing the government with access to consumers’ and businesses’ previously private communications, justifying it as a means of monitoring extremists’ activities.
Providing backdoor access increases the vulnerability of transmissions to unwanted activity from hackers looking to take advantage of the weakest spot in any system. In the words of Eris co-founder and COO Preston Byrne, there is “encryption that works or encryption that’s broken.”
Encryption is an important cornerstone of the fintech sector, providing consumers and businesses with reassurances that their financial information and resources are secure. By forcing UK based financial services providers to weaken the protection they provide to customers, we are likely to see a decline in the competitiveness of our industry vis-a-vis other markets.
The UK financial industry provides a vital contribution to the UK economy with the sector contributing £65bn in tax in 2012/13 financial year and accounting for roughly 9.4% of gross domestic product (GDP). Fintech provides an integral element of the financial services sector ecosystem and is estimated to contribute £20 billion to the UK economy according to Government Office for Science estimates.
The UK Government has come out in support of the growing fintech sector, with the Economic Secretary to the Treasury, Andrea Leadsom recently describing “fintech as the future” which should come as no surprise given growing investment in the sector.
We believe that the Snooper’s Bill presents an ill thought out and disproportionate response to the threats that UK society faces, and we do not accept that the wholesale monitoring of communications and the creating of backdoors is the way to go about this.
We are fully supportive of the Open Rights Group’s petition calling for an end to indiscriminate retention, collection and analysis of everyone’s Internet communications, regardless of whether they are suspected of a crime, and we urge our clients to also sign up. We believe this will help foster a freer more prosperous society for all.
Banksy One Nation photo comes from eddiedangerous’s Flickr stream.