Despite widespread concern, new bank data suggests scammers are losing

It’s hard to believe, but losses based on financial scams, which appear to be swamping the banking system, are actually reducing.

Yet this is what the banks are saying in the latest quarterly report from the Australian Bankers Association, which says there has been a sharp 11 per cent drop in overall scam losses across the market.

Mind you, it’s also hard to believe banks have only just got around to matching the sender of money to the receiver of money. This shocking gap in the system has put enormous — and unnecessary — pressure on bank customers for many years.

The government has been pouring money into trying to find a solution in this area. In the federal budget last week there was another $37m put aside to fight scammers.

Of course, this is just a fraction of the $214m assigned in the budget towards combating fraud in the NDIS. But that’s another story.

Media coverage of scams has intensified of late because the issue of customers, especially elderly Australians, being scammed is now a key concern in consumer banking.

It seems everyone knows someone who has lost money in an exchange where scammers using the banking system were involved. The amount being lost every three months to scams is estimated at $345m.

The sophisticated and extended efforts scammers will take to fool their targets (and, in some instances, the efforts the targeted individual will take to conceal their losses from others) are dramatic.

The recent case of Westpac branch manager Marlena Karbowski and her ultimately successful effort to save a Sydney woman who was about to be scammed of her savings highlights the issue.

The Australian reported in March this year how the unnamed woman had put her $2m home up for sale at the time of the intervention, believing she was helping a prisoner in Turkey who turned out to be fictional.

Despite the heightened awareness of scamming, the latest data also shows losses reported to the Australian Financial Crimes Exchange in the March quarter compared to the previous quarter fell by a hefty 41 per cent.

Commenting on the clear decline in dollars lost, the report said: “This continues the trend observed during the latter half of 2023”.

Collective intelligence gathering by the banks has clearly improved, with the ABA reporting: “The banks now have a confirmation of payee system ensuring people can confirm they are transferring money to the person intended”.

According to the latest report from the National Anti Scam Centre, a decrease in scam losses was reported at each of the three key agencies, which are: The National Anti-Scam Centre’s Scamwatch service, the cybercrime reporting platform ReportCyber, and financial transaction data from the Australian Financial Crimes Exchange.

Anna Bligh, CEO of the ABA and former Queensland Premier said, “this is further evidence that inroads are being made in the fight against scammers”.

ASIC chair Joe Longo has blasted banks for poor customer support through the cost of living crisis. Picture: Jane Dempster

A pity then, that in the same week, the consumer regulator released a 150 page document where Australian Securities and Investments Commission chair Joe Longo publicly criticised banks for their poor record, abandoning customers who needed support throughout the cost of living crisis.

The report took aim at ten home lenders, including the nation’s biggest banks: “In the worst cases, lenders ignored hardship notices, effectively abandoning customers who needed their support,” Mr Longo said.