We consider the safety and resilience of the payments system to require urgent attention and intervention and outline the reasons for this in our joint submission with Financial Rights Legal Centre.
The increasing prevalence of fraud and scams operating within our payments system in particular is a major concern for the clients we represent. Our casework experience indicates that there are a number of areas where the digitisation of banking and finance has created gaps in the security of the payment system that scammers can exploit.
We have been calling the banking industry and payments system to take more responsibility to ensure that scam victims are reimbursed by their banks when they lose money as a result of being tricked into transferring money using banking and payments platforms. We note that the Australian Competition and Consumer Commission (ACCC) has recently called on the banking sector to take more responsibility for preventing and detecting scam transactions and to reimburse customers for their scam losses—a call we strongly support.
Furthermore, the Organisation of Economic Development (OECD) and the G20 recently updated its High-Level Principles on Financial Consumer Protection. These updated principles include a new principle of “protection of consumer assets against frauds, scams and misuse”, noting that “protection mechanisms should include clear and transparent liability arrangements between financial service providers and consumers in the event of financial loss”. This should be taken into account in finalising the proposed strategic plan.
Read the full submission PDF.230206_Tsy_PaymentsSystem_sub_FINAL (1)