Big four banks failing to protect customers against scams, new report finds

The analysis found scam losses for major bank customers exceeded $550 million last financial year, with more than 31,700 customers affected.

Collectively the big four banks are only stopping 13 per cent of payments going out to scammers.

And only two to five percent of stolen money is being reimbursed.

ASIC Deputy Chair Sarah Court said “more work needs to be done” to help protect customers from scammers.

“Australia’s big four banks have invested significantly in their anti-scam efforts over the last several years and have implemented a number of innovative and positive initiatives, including some recently implemented following the conclusion of ASIC’s review,” she said.

“However, the increasing prominence of scams means that there is still more to be done.

“Our review found there were inconsistent experiences and outcomes for customers who were the victim of a scam, and in some cases a bank’s response may contribute to further distress for a customer.”

Court added that as part of the evolution of banks’ scam response they “need to reconsider the ways they respond to and engage with scam victims”.

“We’d like to see the banks take steps to evolve their scam management practices, including how they inform and educate customers and help them through what is a distressing time,” she said.

It comes just weeks after Australian Competition and Consumer Commission’s (ACCC) Scamwatch said bank impersonation scammers are using “new technology” to swindle Australians.

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It said scammers can now make a call appear to come from a legitimate phone number – or more concerningly – can make a text appear in the same conversation threat as genuine messages from a bank.

“We are incredibly concerned about bank impersonation scams because they can be so convincing, they are very hard to detect,” ACCC Deputy Chair Catriona Lowe said.

“What’s equally worrying about this particular scam, is that it is emptying every last cent out of victims’ savings accounts, with losses averaging $22,000 and more than 90 reports of losses between $40,000 and $800,000.

“This causes both financial and emotional devastation.”

ACCC urges customers to be critical of any alleged correspondence from a bank.

“It is critical to remember that no matter how legitimate the call or message seems, a bank won’t ask you to urgently transfer funds,” Lowe said.

“If you receive an SMS with a telephone number to call, do not use it.

“Instead, call your bank direct on a number you have sourced yourself.

“Likewise, hang up if you receive a call from someone claiming to be from your bank requesting you to transfer money to ‘keep it safe’.”