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The conveniences of the Internet and mobile banking create new avenues for fraud across all walks of life. As the world has rapidly adopted highly convenient and frictionless ways to do their day-to-day banking, it is critical we all take the necessary steps to build awareness and knowledge of the risks. The good news is that convenient online and digital banking remains the channel of choice for most, and the tools being adopted and offered by banks are first-class compared to some other parts of the world. It is also important to acknowledge banks have worked hard to lift awareness of these emerging risks and develop tools to assist their customers. The dual challenges of providing convenience and risk management tools are not new for banks - just different.
Fraud Fast Facts
(ACCC Targeting Scams Report 2023)
Here are the most common scams targeting Australians.
'Side Hustle' Job Ad Scam
Job and employment scams grew the fastest of all scam types in 2023. The fake job ad claims to be offering a work-from-home side hustle where people can earn extra income. The catch is you'll be asked to pay money to access the opportunity.
Ads for these fake jobs often appear on social media or are sent via WhatsApp messages and are rigged to look like they're coming from established brands like department or online stores, hotels, and streaming services. The fake job typically involves being paid via crypto to 'boost' a website's product ratings or reviews through an online platform/app.
Trying to secure tickets for popular events creates an opportunity for scammers.
In 2023, the success of the Matildas during the FIFA Women's World Cup saw sports fans targeted. The National Anti-Scam Centre issued a warning before the semifinals in August after receiving reports of scams targeting Matilda's fans on social media.
Loyalty Point Scams
Involves targeting customers of loyalty point programs of well-known Australian companies such as Qantas, Coles, and Telstra.
Customers receive a text message or email stating their loyalty points for a rewards program are expiring. The message includes a link to a fake website encouraging customers to log in and/or provide credit card details to access and use loyalty points.
Superannuation Scams
A common scam targeting Australians is one related to superannuation, with promoters claiming to be able to help Aussies access their super funds early. To do so, the scammer tells the target that they will create a self-managed super fund on behalf of the individual, from which they will then be able to access and withdraw funds.
Deepfake AI Videos
Scammers have started using Deepfake AI videos to create realistic films that seem to be from well-known celebrities or other well-known figures promoting certain investment schemes.
Disturbingly, scammers are also combining AI-generated video with other commonly used tactics, such as phishing emails, to lend credibility to their schemes.
Bank Impersonation Scam
There have also been alarming reports made recently of Australians losing their life savings due to a highly sophisticated "impersonation scam", according to Scamwatch.
The scammers have been using new technology that makes calls appear to come from a bank's legitimate phone number or by sending a text message that appears in the same SMS conversation thread as previous, genuine correspondence from an individual's bank.
The bank impersonation scams have occurred with the big four banks and smaller financial services institutions.
Professionally Branded Fake Websites
Scam websites and marketing materials used to look "a bit off" with poor formatting and grammatical errors, but now you need to take more than a cursory glance to see the signs of a scam.
Fake scam websites don't always mimic an organisation you know. Some professionally presented scam sites claim to be legally run trading and investment platforms—many offering high-risk products.
According to the ACCC, deepfake ads online will often lead to fake investment platforms and trading apps where people are prompted to create an account and deposit funds—the scam is revealed when they seek to take their 'profits'.
For now, the scam accord is set to change how banks respond to financial fraud/scams. Under the accord, financial services institutions, supported by the Australian Banking Association (ABA) and The Customer Owned Banking Association (COBA), are expected to take several measures to disrupt, detect and respond to fraud.
Fraudsters are an innovative. They continue to adapt and find new tactics to offset the scam accord and its framework. That's why it's crucial that every organisation's fraud prevention tools are comprehensive and agile enough to evolve with the fraud landscape.
An end-to-end fraud detection and prevention solution that empowers banks to modify fraud prevention itself is a tool that every financial services institution needed yesterday.
Financial fraud, perpetrated through digital banking channels, is the future of crime. Now is the time for the financial sector's technology partners to stand with the industry and contribute towards building a more secure environment for financial services institutions and their customers.
The scam accord means customers can expect an increase in warning messages and payment delays when they make online payments. As a result, banks can expect a decrease in losses and a higher level of scrutiny - from customers and regulators – should fraud still slip through the cracks.
As a technology partner to Australian financial services institutions, we welcome the scam accord. Protecting financial institutions and their customers from fraud has always been of the utmost significance, and it underpins everything we do at Ultradata to protect clients and help clients grow through market-leading technology.
Stopping fraud needs a comprehensive, end-to-end approach that leverages technology and fosters collaboration between industry, government and law enforcement. Among Ultradata's client base, a group of financial services institutions as diverse as the sector itself, we have fostered a culture of collaboration from the outset. We continue to invest in Fraud Interceptor, our premier fraud prevention tool, so it remains ahead of the industry standard, closing loopholes before fraudsters exploit them.
Written by David Marshall, CEO, Ultradata