By Millie Muroi
Commonwealth Bank chief executive Matt Comyn has revealed the bank is taking down 50 fake CBA websites a week, as he backed tougher rules and penalties for companies that failed to protect customers from scams.
Comyn defended the bank’s $9.8 billion full-year cash profit before the House of Representatives economics committee on Thursday, while also calling for an overhaul of the tax system to more heavily target wealth.
He rebutted criticisms of banks’ card surcharges, arguing that cash transactions are even more costly to process.
Commonwealth Bank chief executive Matt Comyn during a hearing with the standing committee on economics in Canberra.Credit: Alex Ellinghausen
Australians lost $3 billion to scams last year, and banks are under pressure amid debate over who should compensate customers for losses.
The government last year proposed a scams code framework and mandatory industry codes that would obligate businesses, starting with banks, telecommunications providers and digital platforms, to prevent, detect and respond to scams.
Comyn, who said CBA had reduced scam losses by more than 50 per cent in the past financial year, supported a stronger anti-scams regime.
He said this should include a mandatory code to compel banks, telcos and social media giants to meet minimum standards, requirements for key players to share information, and obligations for companies to act quickly to lock bank accounts, block phone numbers and remove scam ads and accounts on social media.
“There should be a proportionate liability scheme which says to all of these organisations that if you do not meet your obligations, then you will be required to reimburse customer losses,” he said.
Labor MP Jerome Laxale brought props to the House standing committee on economics.
Quizzed about credit card surcharges by $5-note-wielding Labor MP Jerome Laxale, who asked why a coffee could cost $5 if he used cash but $5.08 on a card, Comyn said it was not a like-for-like comparison.
“Costs [are] embedded for cash but not embedded for digital because [of] the entire mechanism of electronic payments domestically and globally,” he said.
Laxale has accused the major banks and card providers of gathering about $4 billion in fees from small retailers and their customers through card surcharges.
But Comyn said the CBA business unit that collected card-based payments from businesses and sent them to card issuers was not profitable, and that money the bank received from card issuers was often returned to customers through loyalty points or invested in technology.
“[The merchant-acquiring business] lost money last year and it lost money the year before,” he said, noting businesses’ cost of accepting digital payments was “the lowest anywhere in the world” and had fallen by more than 30 per cent.
Cash payments cost businesses 3.9 per cent to accept – more than double the cost of card payments, he said.
While cash usage has fallen as customers switch to electronic payments, Comyn said the bank would find a long-term sustainable solution to maintain cash.
The Reserve Bank will soon launch a review of the nation’s payments system, but Comyn said parliament needed to urgently pass amendments to allow the RBA to monitor new payment systems such as those provided by Google and Apple.
On the tax system, Comyn said it was “not as efficient, simple and as fair as it could be”.
“I think we’re over-relying on income. I don’t think we’re taxing wealth as heavily as we could. I think it’s part of a broader structural issue that needs to be addressed,” he said.
Comyn said while such changes were “always very unpopular”, they were necessary.
Comyn during a hearing with the standing committee on economics in Canberra.Credit: Alex Ellinghausen
“I can only imagine how difficult it would be, but I do believe that in time, it’s a critical structural reform that will be necessary to drive continued prosperity and productivity,” he said.
Westpac chief executive Peter King agreed that Australia was too dependent on income tax, saying consumption taxes could do more of the heavy lifting.
“I think tax reform is always hard. We’re probably, as a country, too dependent on income tax. Consumption [taxes] can probably do a little bit … more harder work, and then how we think about just some wealth,” he said.
Comyn also criticised the Greens’ proposal to raise $514 billion in new “excessive profit” corporate taxes, saying it was an example of “insidious populism” that ignored the benefits brought by businesses such as CBA.
“We employ 50,000 people. We have paid out $7.8 billion in dividends. We bank more than 13 million Australian households,” he said.
“Businesses in Australia are being represented in this false dichotomy that for a company to earn any sort of income or profit, it is therefore ... somehow being unjustly extracted from consumers.”
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