Conveyancing industry leader says banks must do more to stop scams

INDUSTRY veteran David Winning has challenged Australian banks to do more to stamp out scams.

Your Move Conveyancing founder David spoke out as a Scams Protection Framework makes its way through parliament that would force banks to take more responsibility for illegal hacks that cost consumers $2.74 billion a year.

While UK banks already must repay their customers’ scam losses, except in limited circumstances, there has been a concerted effort by the banking lobby to pushback against a change here.

Only 3 per cent of the money lost to scams is refunded to consumers in Australia, compared to 70 per cent in the UK, according to anti-scam advocacy groups.

David, who founded YMC in 2013, said: “Our own Government has made an attempt at introducing new regulations adopting some similar protections.

“However, it falls well short of the UK model.

“In fact, our own Minster for Financial Services says that the UK model has an unfair focus on banks and fails to put enough emphasis on prevention.

“Tell that to the thousands of fraud victims who, in the last year, lost a total of $2.74 BILLION.

“That’s according to the Australian Competition and Consumer Commission.

“I can’t help but feel there’s an element of underlying victim blaming reading these types of comments. 

“For many years, as a society, we’ve collectively bought into the narrative driven by the banks that faster and faceless banking was what we all wanted. That’s great until something goes wrong.

“And, in the high-risk industry of property transactions we’re in, we, the conveyancers, solicitors, agents and brokers, go to such great lengths to educate consumers on all the reasons why ‘faster and faceless’ can be incredibly dangerous given the current constraints of the banking model.

“We’ve effectively been tasked with the ‘prevention’ element, all while our industries, most of which are small or medium businesses, are left to pick up the pieces when someone falls prey to a fraud event with ever increasing pressures on indemnity insurance and compliance related activities, let alone the mental anguish of being at the coal face of supporting someone through a tragedy like this. 
 
“I don’t believe the UK model is designed to make the problem go away by simply forcing banks to reimburse first then figure out who is at fault later between the banks and providers.

“However, by creating the ‘hurt’ of the loss onto the banks, it forces the industry into innovating, which may not actually be ‘fast is better’.

“While we watch the UK steam ahead in this space, it makes for little comfort that cyber criminals will start to look for easier prey.  

“I’d challenge any of our banking institutions in Australia to be a leader in fraud loss and watch your customer base explode overnight as more and more consumers fall prey to fraud and are looking for an alternative to the ‘faster and faceless’ existing model.”

Submissions into government consultation about the Scams Prevention Framework closed earlier this month, with proposed codes due to be unveiled by the end of the year.

But it is likely to be another 18 months before they become law.

And Consumer Action Law Centre chief executive Stephanie Tonkin says the proposals leave the burden of proof to customers.

“It’s an almost 30-step process that takes between 18 months and two years. With no guarantee of getting any money back at the end,” she said.

Scams targeting property transactions were highlighted in an Australian Conveyancer Special Report last year when we told the story of first-time buyer Simon Elvins, who was swindled out of $270,000.

And the WA property boom has highlighted the fact that cyber fraudsters are targeting property.

One man lost $153,950 after fraudsters intercepted emails between him and his settlement agent in relation to the purchase of a property, the WA ScamNet team revealed.

Given the amounts in question for property transactions and documented evidence that scammers target conveyancers and property lawyers, what do you think?