Commonwealth Bank acts to curb booming crypto scam losses

Australia’s biggest bank will stop or slow transfers to cryptocurrency exchanges – and plans to take more action soon.

The Commonwealth Bank has taken action to stop or slow down transfers to cryptocurrency exchanges due to the risk of scams and fraud.

Australia’s biggest bank said that in coming months it will also limit customer payments for crypto, such as bitcoin, to $10,000 a month.

The CBA said on Thursday it began restricting transfers to crypto exchanges by either putting them on hold for 24 hours or denying them altogether.

Its head of fraud, James Roberts, said scammers had capitalised on the booming interest in crypto by “masquerading as legitimate investment opportunities or diverting funds into cryptocurrency exchanges”.

“With the incidences of scams increasing and in many cases customers suffering significant losses from being scammed, the introduction of 24 hour holds, declines and limits on outbound payments to cryptocurrency exchanges will help reduce both the number of scams and the amount of money lost by customers.”

Commonwealth Bank CEO Matt Comyn. Picture: Supplied

He said customers who make payments to crypto exchanges “are currently facing a significantly higher risk of potentially being scammed”.

“While these measures will not eliminate the risk of customers suffering losses as a result of a scam that involves a payment to a cryptocurrency exchange, they are part of a range of initiatives designed to help customers reduce their risk of falling victim to a scam,” he said.

The CBA’s move comes after Westpac last month banned transfers to the world’s biggest crypto exchange, Binance, and Binance’s Australian payment processor, Cuscal, cut it off from the PayID system.

Massive scam losses by Australians have put pressure on the banks to take action to curb the problem.

Australians lost a record $3.1bn to scams last year, according to a report released by the Australian Competition and Consumer Commission in April.

Crypto losses boomed by 162 per cent last year and it was the second-most reported method of transferring money to scammers, after bank transfers.