Banks claim early credit as they roll out new name checking technology to protect customers from scammers

Australia’s banking industry is claiming success with its belated efforts to stop internet scammers swindling customers. The Australian Banking Association pointed to a new name verification system for electronic payments and anti-scam while highlighting that losses had fallen in the March quarter. Scam losses reported to Australian Financial Crimes Exchange plunged 41 per cent to $99 million, while losses reported to ScamWatch slipped $10m to $73.2m. Scam hits recorded by ReportCyber eased just 3 per cent to $173m in the first quarter of 2024. After years of pressure to upgrade its electronic transfer system, the banking industry in November unveiled a $100m investment in name checking technology to be implemented across the Australian industry. The name checks are designed to patch a gaping hole in the Australian electronic payment system, which is based on every account being built around a six-digit bank state branch (BSB) code and an individual account number. With no name verification built into the ageing system, Australians bank accounts have been particularly fertile ground for scammers — including those pretending to be acting for reputable organisations. The name checking system includes sending a warning message to customers if the name keyed in for a potential new payee does not match the name details on the recipient’s bank account. ABA chief executive Anna Bligh said “inroads were being made in the fight against scammers”. “Whilst it’s encouraging that losses are falling, Australians are still losing too much money to the criminal gangs behind many of the scams that are out there,” she said. The banking industry is fighting a push by consumer advocacy groups to reimburse customers for money lost to scams. The Consumer Action Law Centre argues current rules did not encourage sufficient investment by banks and telecommunications companies in scam fighting measures. Consumer group Choice said the the name checking technology was a “good step forward” but warned scammers “would continue to adapt and find vulnerabilities”.