Imagine logging into your bank account and finding your balance to be $100,000 below the figure you expected.
Unless you are a multimillionaire, you’d probably find yourself with a sickening sensation in the pit of your stomach, one that would only get worse if you learnt that the missing amount is not the result of an error but an online scam.
Your bank may offer some assistance, but are the banks doing enough to protect victims of these types of scams?
According to the Consumer Action Law Centre (CALC), the answer to that question, in Australia at least, is ‘no’.
Tom Abourizk, a policy officer at CALC, says Australian banks are lagging behind their UK counterparts when it comes to protecting customers and victims. Mr Abourizk points to the fact that a number of British financial institutions have signed up to a voluntary code, meaning banks should refund the money unless a customer acted fraudulently or with gross negligence.
Read: Seeking a little extra income? Beware these job scams
The code, says Mr Abourizk, “establishes an onus on the banks; they have a financialinterest to make sure their systems are up to scratch”.
Without a similar code, he says, it means the banking landscape for ordinary Australians is something of a “wild west”.
CALC is not alone in calling on Australia’s banks to do more to protect customers.
The Australian Consumer and Competition Commission (ACCC) has called for a code that would require banks to reimburse scam victims.
Read: How to spot phone scams before they ruin you
An ACCC spokesperson said: “The ACCC considers that reimbursement models should apply particularly in situations where an organisation has failed to take steps that could have protected the consumer or prevented a scammer opening an account.”
Again, this will place greater onus on banks to improve their security measurements. The ACCC says the technology to do so already exists and has resulted in a 35 per cent reduction in misdirected payments in the UK.
Known as Confirmation of Payee (CoP), the technology involves checking the name of the payee’s account against other details given by the payer. In Australia, the major banks use technology known as PayID, but critics say this puts the onus on the customer.
Read: Services Australia tips to keep you safe from scammers
Despite flagging tougher codes for banks ahead of last year’s federal election, the Albanese government has since shown a reluctance to make banks liable for scams.
In November, financial services minister Stephen Jones pushed back against the idea, saying it would lead to more scams.
“I don’t support this approach,” he said. “There should be a high bar on what is expected by all of our institutions – but if they meet all of their obligations it doesn’t seem right that they are liable. If banks always pay, the net result creates a honey pot for scammers.”
So, for the time being at least, it is the bank customers who will bear much of the responsibility of protecting themselves from scammers.
Victims seeking support can go to the Scamwatch website, operated by the ACCC in conjunction with the Australian government.
Have you been the victim of a scam? Do you feel you received adequate support after the event? Why not share your thoughts in the comments section below?