Banks and telcos to face fines for failing to protect scam victims

ABC NEWS (Australia)

The federal government says urgent change is needed after Australians lost almost three billion dollars to scams last year. Soon, tech companies could be required to compensate victims for their losses, under new legislation.

Transcript

00:00This is a big development in this space.

00:04The government's been talking about it for some time, but today we get to see some of

00:09the details from draft legislation they're proposing.

00:13And Stephen Jones, the Minister responsible, has put a big emphasis on prevention.

00:19So he is taking a unique approach here where it's not only the banks under the spotlight,

00:25it's also the big social media companies and the tech giants behind them, the telcos,

00:33who are going to be made responsible under new obligations, which we're yet to see, to

00:39detect, prevent and then respond to scams.

00:42And if they don't do that, there's going to be big penalties attached.

00:47And he says this is going to be much better for consumers, not only in the prevention

00:52space, but if these companies get it wrong, there's going to be more compensation avenues

00:58open to customers.

01:01So let's have a listen to what Stephen Jones has had to say this morning.

01:05There's a major uplift in our protections for Australians against scammers.

01:11This is a part, the next phase in our war against the scammers.

01:14We've already stood up a national anti-scam centre.

01:17We're already taking down fake investment sites and filtering out millions and millions

01:21of messages and phone calls every week.

01:24And it's working.

01:25It's meant for the first time ever that Australian scam losses haven't doubled.

01:29Only country in the world where that has occurred, but we're still losing $2.75 billion a year

01:35and that's far too much.

01:36Every dollar is a tragedy.

01:39Stephen Jones there.

01:40So this is a significant development in this space.

01:44And while there's not all the detail that we need to analyse it fully, this is a very

01:48interesting development.

01:51What could those obligations include?

01:54We don't know yet, but Stephen Jones has outlined some of them.

01:57So banks, for example, will have to make sure that a technology called confirmation of payee

02:03is in place for customers across the industry.

02:05So that's when you go to make a payment in the banking app or online and you get a warning

02:13if the person you're intending to pay, their account details and name don't match who you

02:19think it is.

02:20So that will be a key development that exists already overseas and is saving a lot of money

02:26overseas that will have to be in place here.

02:30There'll be other developments.

02:31So banks will be required on the receiving end.

02:35So there's obviously the bank paying the money, often a bank receiving the money before it's

02:40stolen on the other end.

02:43Banks will be made responsible for cracking down on what's called money mule accounts.

02:47So these are bank accounts controlled by criminals that are used to receive scam victims'

02:53money and then shift it, usually offshore.

02:57So there'll be a new responsibility around that.

03:00There's going to be obligations on the phone providers to crack down on who's sending text

03:07messages to make sure that if your viewers are anything like me, I still get multiple

03:14scam text messages a week.

03:17Crack down on who's sending those and also blocking scam numbers that continue to pester

03:24people to try and get them to invest in scams.

03:27So there'll be that as well as the tech giants will be made responsible for verifying advertisers

03:34on their platforms and taking down known scam content.

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