New report highlights shortcomings in scam prevention and response strategies among 15 Australian banks
The Australian Securities and Investments Commission (ASIC) has found significant disparities in scam prevention, detection, and response strategies of 15 banks outside the big four.
In a report titled “Anti-scam practices of banks outside the four major banks,” the regulator has identified several key issues, including varying levels of scam strategy maturity, inconsistent approaches to liability, and insufficient support for scam victims.
ASIC deputy chair Sarah Court (pictured above) noted that while recent data from the Australian Competition and Consumer Commission (ACCC) suggested a decrease in overall scam losses despite a rise in reported scams, ASIC’s findings underscore the need for a coordinated effort to maintain this trend.
ASIC’s analysis found that customers bore 96% of scam losses during the 2022-2023 financial year, with banks detecting and stopping 19% of scam transactions by value. However, the effectiveness of these measures varied widely across the institutions. The ACCC reported that Australians lost $2.74 billion to scams in 2023, with overall losses decreasing by 13% despite an 18.5% increase in reported scams.
“Like the four major banks we reported on last year, the 15 banks in this latest report also demonstrated a less mature approach to scams strategy and governance than we expected,” Court said. “While recent data suggests Australians are becoming more savvy in avoiding scams, we need continued focus across industry and regulators to effectively tackle this important issue.”
ASIC’s new report provides a snapshot of the 15 banks’ practices as of mid-2022, before the implementation of key anti-scam measures such as the National Anti-Scam Centre and ASIC’s website takedown service. Court emphasised that while many banks have initiated scam education programs, significant improvements are still needed.
Case studies reviewed in the report also highlighted several customer service issues, including slow response times, mishandling of reports, and inadequate identification of vulnerable customers affected by scams.
“We expect all banks, regardless of their size, to pull their weight in the fight against scams,” Court said. “Boards and senior management have a key role to play in driving improvement.”
ASIC also provided advice for consumers to protect themselves from scams, encouraging them to stop, check, and report suspicious activity. The regulator urged anyone who believes they have been scammed to visit scamwatch.gov.au for resources to mitigate damage and prevent further loss.
This report is part of ASIC’s ongoing focus on improving anti-scam practices across the financial services sector. It is also reviewing the anti-scam measures of superannuation trustees.
The 15 banks reviewed were AMP Bank, Bank Australia, Bank of Sydney, Bendigo and Adelaide Bank, Beyond Bank Australia, Credit Union Australia, Heritage and People’s Choice, ING Bank (Australia), Macquarie Bank, Newcastle Greater Mutual Group, PayPal Australia, Rabobank Australia, Suncorp Bank, Teachers Mutual Bank, and Wise Australia.
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