The Australian Financial Complaints Authority (AFCA) has welcomed the latest initiative from a major bank aimed at protecting customers from potential scams.
“AFCA is deeply concerned about the increase in scam complaints, the increasing sophistication of scams and losses caused by them. The impact of a scam on a person can be devastating and life changing,” AFCA’s Chief Ombudsman and Chief Executive, David Locke, said. “We welcome the initiatives that are emerging.”
Westpac has announced a new verification system that will alert its customers if there is a potential account name mis-match for payments, or if a customer is seeking to transfer money to an account Westpac has never transacted with before.
In 2021-22, AFCA received 4,131 complaints in relation to scams, an average of around 340 a month. That was up 28 per cent on the previous year.
In the current financial year, this has increased to an average of 400 scam-related complaints a month.
“As well as industry-led initiatives, we also encourage people to talk to their friends and family, particularly vulnerable people they know, about the dangers of scams,” Mr Locke added. “The more that people are aware, the less likely they are to fall victim to scams.”
AFCA is engaging with industry, consumer groups and regulators, sharing its complaints data and insights, in the joint effort to reduce scam transactions.
Westpac joins the Commonwealth Bank of Australia in announcing such a verification measure.
Mr Locke called on other banks to follow suit. “It is important that all banks adopt measures to match names of accounts with BSB numbers and account numbers if we are to stop some of the invoice hacking scams that we are seeing.”
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The Australian Financial Complaints Authority (AFCA) is a non-government ombudsman service providing free, fair and independent dispute resolution to individual consumers and small businesses when they are not able to resolve complaints directly with financial firms in banking and finance, insurance, investments and advice, and superannuation. AFCA aims to help the parties reach agreement, but it can issue decisions that are binding on financial firms.