TIM WEBSTER:
Get them. I’ll tell them. I’ll give them to you as well. Well, now, here is our Assistant Treasurer and Financial Services Minister, Stephen Jones, joining us on afternoons. Minister, g’day.
STEPHEN JONES:
Good afternoon, Tim. Good to be with you.
WEBSTER:
Yeah, lovely to talk to you too. And good on you helping us with this, because am I correct in saying, once upon a time, the banks were more helpful with being skimmed and scammed than they are now?
JONES:
Look, I’m not sure that is the case. I tell you what is the case, and that is that we’ve seen the industrialisation of the scam in industry over the last 5, 6 years. And prior to coming into government, the losses were doubling every year. They were about $3 billion, set to hit $6 billion when we came into office. We’ve reversed that trend. They’ve dropped a bit, but they’re still too high, about $2.7 billion. So, the program we put in place, which is prevention first, is working, but we’ve got a long way to go. The next wave of reform that I put in will put big obligations on banks, on telecommunications companies and social media platforms. And, as you were saying in your introduction, failure to meet those obligations will require compensation to victims and penalties in place where victims have lost money.
WEBSTER:
Yeah, well, we get listeners all of the time telling us they’ve lost money and in some cases, really significant sums of money. And honestly, Minister, it’s just really heartbreaking. It is. And really through no fault of their own, because they’ve been deceived out of the money, haven’t they?
JONES:
Yeah. This is the key to it. We already have laws in place. We distinguish between what we say authorised payments to scammers and unauthorised payments to criminals. An unauthorised payment. We already have laws in place which require refund of money where the withdrawal of funds has been without the authorisation the customer. It gets a lot more tricky when somebody actually directs the payment and says, pay this money into this account or pay this money to this service provider, and it’s a scam. And that’s why we need to put in, we need to change the law, because, as you say, they’ve become a lot more tricky, a lot harder to detect. So, we’ve got to have all the big players doing much, much more to detect, remove, prevent and then compensate if they have failed to meet their obligation.
WEBSTER:
Yeah, I’m pretty sure at the Press Club yesterday, you said exactly that you can receive compensation, but it has to be in the right circumstances. And I suppose that’s where it also gets a bit tricky. Does it?
JONES:
Yeah, it does. We don’t want to have a situation where there is absolutely no responsibility for a consumer to take care. Now I have listened in and heard recordings of conversations between banks and customers where a bank employee has tried to point out to, look, this, we’re pretty sure that this is a dodgy account, we’re pretty sure that this is not a valid player, that this may be involving criminal activity. And the person has said, no, I know what I’m doing. Transfer the money over. So, there’s got to be some exemptions and some carve outs and there has to be some consumer responsibility in this as well. But we also think there needs to be much, much, much more responsibility for every other player in the ecosystem.
WEBSTER:
Yeah, I’m saying they were better at it because it was my experience and listeners have said it too. And thankfully we’ve been got a couple of times and it wasn’t for a lot of money, but back then, and it’s probably more than a year ago, you’d call the bank and it required you to, you know, have your credit card cancelled, but they’d give the money back and then investigate themselves. Now in both instances I never had to pay a cent and they did, I don’t know what they did. Probably got the money back from the other party or just, I don’t know, copped it and absorbed it themselves. But I thought to myself, that’s pretty good. And these days when you make a transaction, certainly with my bank, they send you 2 or 3 little messages to say, are you sure, is that the right BSB, is that the right account number before we process this? And we’ll leave it for 24 hours. So, I think they’re all good things and I imagine most banks do.
JONES:
Yeah, we’re lifting the standard in that area as well. So, by the end of next year, all banks will be required to have in place what we call a confirmation of payee. So, when you type in a number that you’ve been given to pay a bill, the name of the account has to pop up. Some banks do it already, but not all of them. That’ll be mandatory so that people have another layer of confirmation. It also helps for people like me who might have fat thumbs and automatically type in the wrong number. Yeah, there’ll be a range of things that we’re going to be requiring of banks, but also frankly, the telecommunications companies and social media platforms. So, the telecommunications companies, that’s how the over half the scam losses are coming to people through an SMS message or a phone call. So, filtering out all of that criminal content before it hits a consumer is a part of our plan. And getting the social media platforms pull down all of the fake material and the criminal content that is on their network, that’s got to be a critical part of it as well.
WEBSTER:
Yeah, every time we discuss one of these, in fact, Professor George Williams was just in here, the new vice chancellor at University of Western Sydney. He mentioned it too. AI. I mean, there’s so much stuff that you see that’s obviously. Well, I’m going to say obviously, some of it isn’t obviously, because it’s so good AI generated material. That’s also going to be an attempted scam in many cases, I’m sure, 100 per cent, Tim.
JONES:
There won’t be a high profile celebrity, whether it’s a business person, a politician or a sports star, who hasn’t had their identity stolen online and used to promote some dodgy investment, whether it’s cryptocurrency investment or something other wild scheme, and they’ve all looked a little bit off. But AI enables the criminals to make them look better and better and you can only imagine how much harm they’ll do and it’s not a celebrity that they’re impersonating, but you or me or one of our loved ones as, I mean, convincing us to do something.
WEBSTER:
Yeah, the thing that bothers me and always has with this, it tends to be not all of the time, but a lot of elderly people get caught up in this because they’re very trusting. They might get an email or, you know, a text from and it’s supposedly the bank or it’s the ATO or it’s somebody and they, you know, panic a bit and do the wrong thing and click on the link. And of course, that puts it all into train. And it worries me if the right circumstances don’t fit that model, I mean, they’re going to lose their money. So, it is, as you say, a very tricky situation all round.
JONES:
It really is. You know, I never have a conversation like this, Tim, without handing out 3 top tips. Number one, don’t let somebody remote access into your computer. That’s just what scammers do. Don’t give your information out to unsolicited callers. And number 3, don’t press any of those bloody blue links on your SMS’ or your emails, because that’s how scammers trick you into going to a fake website. Doing those 3 things is a bit like the equivalent of sticking on a seatbelt before you get in your car and before you turn your car on and get onto the road. So, it’ll keep you safer. Doing those 3 things will help a lot. And, of course, whether you’re an older Australian or a younger Australian, that gut instinct that you had about whether something looks too good to be true, then it almost certainly is.
WEBSTER:
Almost certainly is. Yeah. Jose wants me to ask you, what about a secret question and answer for each individual customer so that people can use that to, pardon me, that calls are coming from the bank and not some scammer.
JONES:
Yeah, absolutely right. And the pressure will be placed on the banks to improve the way that they’re authenticating customers. Most of them have got what we call a 2. A 2 factor or identification, or a multi factor identification arrangement. But, yep, change your passwords regularly. Use a sentence, not your birth date, the word password, which is the most common password in the world, to keep your bank. If you’re using online banking to keep it safe, there’s a bunch of things you can do which is like, exactly as I say, just like putting on a seatbelt. If you do them, you’ll keep yourself safe. And consumers should be arming themselves with these tools, but we would be putting responsibility on the big players in the ecosystem to keep their customers safe as well.
WEBSTER:
Yeah and Rob my texter responds with, exactly what are older people supposed to do? Well, I guess try to be a Minister, as careful as you can be. That’s probably the only thing we can say. Or maybe not the only thing, but it’s the primary thing.
JONES:
Yeah. Look, it’s important that people just do those safety first steps and have them in place. But I don’t. So, I don’t want to absolve business or government from any responsibility in this as well. We do have a responsibility to help people. Overwhelmingly, business and commerce is conducted online and digitally nowadays. Enormous benefits to business and others because of this. The costs and risks of this have got to be mitigated. And all of those businesses which benefit from the digital economy have got a huge responsibility to ensure that it’s safe for our consumers.
WEBSTER:
Yeah. Lynn says to us too, Minister, I worked in banking many years ago. We were obliged to check the account name and the number matched if that was compulsory. Again, I think we might avoid many of the scams. But the scammers, well, who knows where they are? They could be in, like, Nigeria, they could be anywhere. Are becoming extremely clever. I think that’s one of the, in fact, probably the real problem, the number one problem in it. Or is it not?
JONES:
No, it’s true. And it often gets proposed to me. Why don’t we just employ more police to kick down doors and arrest the bad guys? And our police do a great job with the tools they have available to them. But more and more, in fact, overwhelmingly, these scams are being perpetrated by criminal gangs operating in other countries, often in places where just traditional law enforcement cannot reach them.
WEBSTER:
Yeah.
JONES:
So, that’s not the [inaudible] answer the most part of the answer. Prevention. The sorts of strategies I’m talking about is, and, you know, there’s been a lot of banks. I don’t want the takeout from this to be, you know, don’t do your banking online or don’t pay.
WEBSTER:
No, no.
JONES:
Because it’s brought enormous benefits. We can buy things from anywhere in the world now. We can. Instead of rushing out at lunchtime to pay a bill, you just do it through your banking app. So, it’s a lot of benefits in that, but it’s got a lot of risks as well, and we’ve got to protect ourselves and the country against those risks.
WEBSTER:
Yes, I do it on the train, Minister. That’s my little banking. Half hour on the train and you can. You can do it all in half an hour. Well, see, I’m glad you’re on the line because you’re getting the perspective of listeners. John says to us, I was duped trying to obtain a US visa. A Spanish website copied the US Embassy. I agreed to the payment, but instead of $30, it was 180, and the bank could do nothing because I agreed to the payment.
JONES:
Well, that’s the problem. And we’re coming smack bang up against what the traditional law of banking has been. So, the contract that you have with your bank is I leave my money with you and I can take it out or direct you to pay it to somebody else at my discretion. That’s the traditional contract that exists between us and our banks. And it’s easy to set the law as we have when there is an unauthorised payment, that is, money is moved from your account without your authorisation. Funds occur in those circumstances because that’s how the current law works. But where you’ve got you actually authorising the movement of payment from one place to another, that’s challenging, and that’s why we’ve got to change the law and ensure we get the balance right. I don’t want there to be a situation where there’s no personal responsibility, but there has to be more business responsibility in this area as well.
WEBSTER:
Yes, and like you, I don’t want the takeaway to be, don’t do your banking online or any of that, because it is, as you say, so incredibly inconvenient. And we are, I think, Minister, whether we like it or not, and a lot of people don’t, moving away from cash, and that’s just, you know, a symptom of the generation in which we live, I think. Here’s Glenn.
JONES:
For us, I could say, don’t do it, but, you know, over 88 per cent of retail transactions are now done by a tap and go, whether it’s a card or mobile phone. It’s not. Doesn’t involve cash. So, it’s the way the consumers have gone.
WEBSTER:
Yep. Hi, Glenn. Hi, Tim.
CALLER 1 – GLENN:
Hi Tim. I’ve always wondered why we can’t track scammers using the phone numbers. And why we can’t freeze the accounts. Because they give us account details.
JONES:
Yeah, great question. Can I answer that one?
WEBSTER:
Yeah, please. Please do. Yeah, yeah.
JONES:
So, but we are tracing and tracking the phone numbers, and one of the obligations we put on the telecommunications company is that they block them. So, once we know a scam number, it’s blocked, but they then move to another one. It becomes a game of whack a mole. So, one of the new obligations we’re going to put on the phone companies is particularly in the area of SMS messages. If you want to send out an SMS message and you’re a bank or a telecommunications company or any of the big famous brands, then your name’s got to be on a register. And if you’re trying to send a phone number, a message out pretending to be that brand and your number’s not on the register, it gets filtered and blocked. And if you like, it goes from a black list of things that we block because we know they’re bad numbers, to a list of numbers that we permit to send SMS on behalf of those famous brands because they’re approved and everyone else pretending to them gets blocked.
WEBSTER:
Okay.
JONES:
So, doing with those in the area of bank accounts? Yes, when we become aware of. We call them mule accounts, the accounts that are being used to ferret money out of the country, a big obligation on banks will be to identify them and close them down.
WEBSTER:
All right, Glenn, and thanks for your call. Spencer. Just hang on a sec. I’m just going to say to you, obviously, this is going to be very complicated legislation to frame. Have you got a timeframe as to when it might be in place?
JONES:
Yeah, look, we’re working through all of that stuff at the moment. Just when you think you’ve got it all nailed down. A new, you know, complication or issue comes up. So, we’re working through all of those issues at the moment, and we’re doing it in a way where we can say, okay, the initial obligations will be on banks, telecommunications companies and social media platforms, but we’re never going to have to extend it beyond there. So, for example, once we make those places safer, the crims will just go to other buckets of money. So, they’ll look at superannuation or insurance or somewhere else. So, we’re going to have to frame the legislation in a way that we can extend it to these other areas pretty quickly.
WEBSTER:
Yeah, I love the fact that our listeners send these texts, but I hate the context of them. Louise says, last year my daughter, who is serious health problems, was in hospital under heavy sedation and had a life savings of $23,000 stolen from the account. Goodness me. The bank did nothing to help. The banks have made us move to electronic banking, but they don’t protect us. And this is what you’re about, Minister, isn’t it?
JONES:
That’s exactly right. I mean, banks and consumers, Australians have been it, have had enormous benefits from online banking arrangements. Like, we’ve all benefited from that for the reasons we’re talking about. But there’s also a risk and harm that comes with that. And if we want Australians to have faith in the rails of modern commerce, then they’ve got to understand and feel comfortable that there are guardrails in there as well.
WEBSTER:
Just excuse me for one second, Minister, because there is an accident on the M5 heading into town involving multiple vehicles. It’s at Liverpool, just past the Hume highway. Very heavy traffic already stopped there in both lanes, and the emergency services are there now. Happened a relatively short time ago. If you can avoid the M5, that would be a very good idea. Just repeating that. City bound involving multiple vehicles at Liverpool, just past the Hume highway. I doubt there’s a busier intersection than that. So, heavy traffic already. So, please, if you can avoid the area, and Spencer’s there for us. Hi, Spencer, you from Cranbrook or Cranebrook?
CALLER 2 – SPENCER:
Cranebrook. 2749. Hey, guys, I’m in the industry. I always see people of senior years losing their funds from at call accounts. And my message today to people in their fifties and sixties, in terms of the advice they give to their parents, for the love of God, forget what the interest rate is. That that’s an evil, a very evil distraction. Get the money out of an at‑call account, get it into a turn deposit. If your parents have got $400,000 worth of capital. And for the love of God, put 380,000 into a term deposit. Let them play around with the residual. 20,000. Do what? Let the scammer take it. Hand it to the scammer on a platter. But for the love of God, shore up 90 per cent of your parents capital by putting it onto term deposit. I’ve never seen a term deposit raided yet.
WEBSTER:
Is that right? They can’t. They can’t get. Can’t get it, then.
SPENCER:
Yeah, that’s right. Well, I’m not saying can’t is a universal for the next 10 years.
WEBSTER:
But you’ve never seen it.
SPENCER:
200 of the last 200 cases that I’ve dealt with, Tim, have been at‑call accounts where people are seduced by all. Look, there’s an extra .025 per cent interest rate Just forget it. Get your parents capital onto a term deposit.
WEBSTER:
Good on you, Spencer. Thanks for the call.
SPENCER:
Thanks, friends. Thank you.
WEBSTER:
Yeah. Terry says to us, Minister and everybody, we’re going to have to leave the conversation too, because the news will rush up pretty quickly. One of the main reasons we don’t use much cash is because the banks make it difficult for us to do that. No customer service, they’re only interested in making large profits for shareholders. Well, Minister, that’s another issue. And we’re talking to all of NSW now, all of the regions, and they say that to us often too. You know, the bank’s closed, the ATM’s have closed, I’ve got to go to another town to get some money. And particularly elderly people like to go into the bank and get their money. So, I don’t know what we do about that, if anything.
JONES:
Yeah, we want to ensure that cash is still available for those for whom it’s their preferred means of doing business. So, it still has to be available. As less and less people are using it, the cost of transporting it and storing it and distributing it becomes more and more expensive. That’s just a fact of money, a fact of life. But we do want to ensure that continues to be available, particularly in regional areas as well, where, you know, telecommunications networks might not be as reliable and therefore electronic banking arrangements that are relying on those networks go down from time to time. So, cash has got to be available.
WEBSTER:
A couple of things before I let you go. Are you expecting a bit of blowback from the banks about all of this when this legislation is framed and put up?
JONES:
Well, I think the banks understand that a part of their social licence is ensuring that they can keep their customers money safe and they make a contribution to the overall safety of the economy. So, I think they get it. Yeah. There’ll be disagreements with them over various aspects of the plan, but I think they understand we’re all heading in a direction and we’re determined to get this done.
WEBSTER:
Yeah. Okay. And we’ll see it eventually. As I say, every time we discuss this subject, and it’s great having you on, get pretty much the same context of text messages and phone calls about all of this and what can be done. But I mean, the thing is, there’s these awful dark people sitting around in places all over the world phoning phone numbers and trying to get your money. And it’s just a simple fact of life, sadly, a modern one, but a simple one.
JONES:
Yeah. Tim, great to talk to you and your listeners. Remember those tips that I gave to people. Don’t press the bloody blue links. Don’t let anyone remote access into your computer. And don’t give your information out over on, on the phone to an unsolicited caller.
WEBSTER:
Good on you. Thanks for your time.
JONES:
Good to be with you.
WEBSTER:
That’s our Assistant Treasurer and Minister for Financial Services, Stephen Jones.