iscover
Share this article on:
Powered by
MOMENTUM
MEDIA
Aussie banks have lifted the lid on a new platform that will aid the fight against financial scams, enabling faster reporting and the lockdown on fraudulent payments.
The Fraud Reporting Exchange (FRX) platform was announced by the Australian Banking Association (ABA) on Tuesday (16 May) and will allow the “reporting of scam payments in close to real time, boosting the likelihood that funds can be frozen and returned to customers”, according to the ABA.
The FRX will streamline the scam-prevention process in a number of ways, allowing banks to share intelligence to assist in preventing scams, the ability to freeze multiple transactions believed to be part of the same scam where possible, and a faster return of stolen funds to victims.
“Given every minute can be crucial in disrupting scams, the launch of the FRX is a major development,” said ABA chief executive Anna Bligh.
“It means more and more scammers are going to hit a brick wall and adds to the arsenal of anti-scam initiatives underway.”
Bank transfer scams are a leading form of financial scam in Australia. According to the Australian Securities and Investments Commission (ASIC), the big four Aussie banks lost a total of $558 million to scams in the 2021 to 2022 financial year, with 31,100 victims. Total scam losses in 2022 for Australians exceeded $3 billion.
Despite this, banks roughly paid only $21 million in compensation, with a reimbursement rate of 2 to 5 per cent.
However, with a large number of banks signing up for the FRX, compensation numbers are likely to rise.
As Bligh pointed out: “The sooner that banks know about a fraud, the sooner they can take swift action to try to halt the payment before it gets to the scammers.”
Seventeen banks have signed up to the new platform, and trials have seen the time it takes to settle scam cases has been cut in half.
“With 17 banks already onboard or in the process of joining the FRX, banks are now better placed to jointly identify funds [that[] have been fraudulently transferred, which should improve their ability to prevent any further losses to a customer,” added Bligh.
Australian Financial Crimes Exchange managing director David Pegley said that the FRX is set to revolutionise scam management in the banking industry.
“Thanks to the banking sector, and particularly the four major banks, this new platform is set to make an impact on scammers and can also be used to help to bring together banks and any other organisations involved in payments,” Pegley said.
The news of the FRX comes just as the federal government has announced $86.5 million in funding to create a National Anti-Scam Centre, which will be run by the Australian Competition and Consumer Commission.
The anti-scam centre will allow for greater information sharing between law enforcement and government bodies.
Be the first to hear the latest developments in the cyber industry.
