Assistant treasurer cosied up to banks, tech giants say

Assistant Treasurer Stephen Jones is under fire for his handling of the draft scam prevention legislation after the lobby group representing tech giants, including Meta and Google, said the federal government had cosied up to the banks on the proposed laws.

Technology lobby group DIGI has cited documents released under Freedom of Information laws to highlight what it says is an “extraordinary” level of engagement between Jones and Australia’s banks over a two-year period.

Assistant Treasurer and Minister for Financial Services Stephen Jones said DIGI was “not fair dinkum” about stopping scams.Credit: Louise Kennerley

Treasury “met regularly with the Australian Banking Association and member banks to align government and industry efforts”, according to the documents. One meeting held in November 2023 was described by one official as a “hot-house workshop”, in which Jones, the Australian Banking Association and member banks, including NAB, discussed possible banking sector obligations under the proposed legislation.

However, Jones has rejected the criticism. He said DIGI (which represents Google, Meta, X, Snap and Microsoft) was “not fair dinkum” about stopping scams and was “running a campaign for social media platforms to avoid liability under the government’s new laws”.

The war on words has erupted after the federal government last month released draft legislation that it said would provide the toughest anti-scam protections in the world, including fines of up to $50 million for banks, telcos and tech giants like Facebook if they fail to detect and block scammers.

The proposed anti-scam regime will not follow the British model, in which banks are required to reimburse scam victims in most cases. Australia’s laws will instead seek to share the responsibility between banks, tech platforms and telcos and to create industry codes they’ll be required to adhere to.

DIGI managing director Sunita Bose said the extent of engagement between the banks and Jones raised concerns that needed to be addressed, and the government should not “rush through legislation in pre-election haste.”

“I’m not entirely sure what a ‘hot house’ workshop is, but it suggests a level of intense consultation between Minister Jones and the banks to shape their legal obligations,” she said.

“We need crystal clear legal obligations for industry in this legislation. These obligations are so unclear that companies will be spamming consumers and inundating the regulator about every possible scam, and the regulator won’t even be sharing that information with Australians or using it to have scams removed.”

Jones defended the consultation process and said about two-thirds of scams in Australia originated from social media platforms.

Proposed changes to the Privacy Act place too much burden on individuals and don’t tell businesses gow to chare the burden, says Sunita Bose, managing director of Digi.Credit: Jeremy Piper

“Our laws ensure that social media platforms, telcos, and banks prevent and protect consumers from scams or face up to $50 million in penalties and be required to compensate victims,” he said.

“It is unfortunate that the lobby group for Big Tech are promoting their weak, voluntary industry code as an alternative. It’s not good enough. It is even weaker than what they signed up to in the UK. The laws of Australia don’t stop at the internet. No one is off the hook.”

A spokesman for the Australian Banking Association said banks had participated in consultations, as had telcos, social media platforms and consumer groups. “Banks support legislation that enshrines an entire ecosystem approach, which is the only way to properly protect consumers and help drive down scam losses.”

Consumer Action Law Centre chief Stephanie Tonkin says the laws will fall short of protecting consumers

Meanwhile, Customer Owned Banking Association chief executive Michael Lawrence said the organisation backed the government’s proposed “ecosystem approach to scams that includes digital platforms and telecommunication providers in the Scams Prevention Framework from the start”.

However, the proposed anti-scam legislation has faced criticism from other quarters including the Consumer Action Law Centre, which says it puts too much onus on consumers to fight for redress in lengthy dispute resolution processes that could take between 18 months and two years.

“What’s worse than this delay is that there is no guarantee of victims getting any money back at the end,” its chief executive Stephanie Tonkin said.

Independent senator David Pocock earlier this month held a Canberra press conference alongside scam victims to call for stronger action against scammers.

Independent senator David Pocock earlier this month held a Canberra press conference alongside scam victims to call for stronger action against scammers. Credit: Alex Ellinghausen

“The government’s top priority here should be protecting people, not shaping policy in the best interests of big corporations, whether they are big banks, telcos or social media giants,” he said.

Pocock said a more robust protection framework was needed. “This must include a reimbursement model that has proven to be successful in the UK. The government’s current proposal is weak, won’t be effective and puts far too much burden on scam victims.”

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