Online financial scams have become the “plague of our times”, banking executives have warned, as major lenders devote more resources to combating them.
A two-day federal parliamentary hearing into Australia’s big four banks has been told while financial losses from online scams are largely down, prevention efforts have been ramping up.
NAB chief executive Andrew Irvine said more than $100 million in payments to scammers had been disrupted between March 2023 and June 2024.
“This is the plague of our times,” he told the inquiry.
“Customer losses have fallen 24 per cent between October 2023 and June 2024, compared with the same period the year before.
“Banks, telcos and in particular, social and digital media companies, need to do more to play their part to stop scams happening before they reach customers.”
ANZ boss Shayne Elliott said almost a third of all financial scams dealt with by the bank stemmed from Facebook.
“The sophistication of these scammers is increasing every single day and with the advent of new technology like generative AI, (it) has given them yet another tool to exploit,” he said.
“All of us, if we haven’t been scammed or experienced a scam, we all know somebody who has, so it’s a blight on the entire community.”
Commonwealth Bank chief executive Matt Comyn said an increasing number of its employees were dealing with financial scam prevention.
“We have over 4000 people working full time across these areas and it is now one of the largest areas of operational activity within the Commonwealth Bank,” he said.
“We were able to cut scam losses to customers by more than 50 per cent in the last financial year.”
Mr Comyn also repeated calls for banks and other companies on the frontline to do more to prevent customers losing money to scammers.
The executive used his appearance at the inquiry to urge those companies to be part of liability schemes in which customer funds would be reimbursed if protection obligations were not met.
“This liability scheme should be simple, efficient and fair for customers with a single front door to access and resolve disputes across scams, fraud, cyber security and financial crime prevention,” he said.
“The challenge now is to continue to drive (scams) down.
“It is simply not possible for the banks alone to limit scam losses across the community.”
Westpac boss Peter King said investment scams made up about half of all customer losses.
“Too often, Australians are getting their investment advice from ads they’re finding online including on Meta (Facebook’s parent company) platforms,” he said.
“Digital platforms and social media companies are still missing in action when it comes to the fight against scams.”
