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Consumer Action Law Centre, CHOICE and the Australian Communications Consumer Action Network have been conducting regular roundtables with scams victims and consumer organisations, to develop our responses to the proposal outlined in the Scams – Mandatory Industry Codes Consultation Paper (the Paper). This submission includes the collective view of our organisations.

At the heart of the scams regulatory framework must be liability for reimbursement resting with industry. For the reasons and examples outlined below, the only workable framework that will effectively disrupt scams and protect consumers would be a presumption of reimbursement of scam losses, with industry bearing the onus of proof otherwise. The regulatory framework needs to be governed by the key principles outlined below and explained in further detail in the full joint submission.

If the money lost to scams were to come straight out of the bottom line of the industries who are the gatekeepers of people’s money, personal and online information, industry will be incentivised to significantly increase their investment in measures and new technologies to keep the public and their customers safe and secure. This is the only way to achieve the level of investment needed by industry to disrupt scams in Australia.

Consumers need a simplified, single pathway to seek redress after businesses fail to protect them from scams. This complaint avenue should be through the customer’s bank or financial institution where the funds were initially kept or lost. The regulatory framework proposed in the Paper is far too complex and will be virtually impossible for
consumers to navigate on their own and for industry to deliver.

While the core principles of the Paper are a step in the right direction, they do not meet community expectations of the ‘tough new industry codes’ or a ‘high bar for liability’ that the Government has been promising for the past year and a half. The primary goal of the introduction of mandatory laws and codes relating to scams should be modelled around improving consumer outcomes and preventing harm, rather than solely relying on businesses to comply with minimum obligations, which will continue to result in victim blaming and shifting obligations and costs onto consumers who are near-powerless to detect or prevent scams from occurring.

Read the full submission here: