The federal government has approved changes allowing the Australian Financial Complaints Authority (AFCA) to investigate the role of receiving banks in scam-related cases.
Under current rules, AFCA can only review the actions of the bank that transferred a customer’s funds.
The new directive, set to take effect within 12 months, will expand AFCA’s authority to examine whether receiving banks took appropriate measures to prevent fraudulent transactions.
Assistant Treasurer and Minister for Financial Services Stephen Jones (pictured) said the move is part of broader reforms to improve consumer protections and enhance financial sector accountability.
“We made fighting scams a priority from day one, and it’s having a real and significant impact. Scammers are finding it harder and harder to get through our defences,” he said. “We want Australians to enjoy the benefits of online commerce but have trust that they are protected against the criminals trying to get their hard‑earned money.”
AFCA chief ombudsman and CEO David Locke explained that the actions of receiving banks can now be considered as part of the full chain of events in a scam.
“We welcome this direction from the government. AFCA will work with industry and consumer groups over coming months on the changes required to AFCA’s rules to ensure a smooth transition to implement this change,” he said.
The federal government attributed the decline in scam-related losses to strengthened enforcement and regulatory measures introduced as part of its anti-scam agenda.
Since taking office, it has allocated $180 million to initiatives aimed at disrupting scam operations and increasing consumer protection.
Key measures include:
Jones said while the decline in scam losses is a positive development, scams continue to pose a financial risk to consumers, requiring continued vigilance and regulatory action.
“Fraudsters cause financial and immeasurable emotional and mental stress by impersonating legitimate organisations every day, but we are determined to do what we can to keep Australians safe,” he said.
As the government expands its anti-scam framework, the Insurance Council of Australia (ICA) has urged policymakers to consider the unique characteristics of the insurance sector when applying new regulations.
In early 2025, the ICA presented its position on the Scams Prevention Framework Bill to a Senate Economics Legislation Committee inquiry.
The proposed legislation seeks to impose new obligations on banks, telecommunications providers, and digital platforms to detect, report, and prevent scams. It also introduces a framework for assigning liability and establishing a consumer redress system.
While acknowledging the need for stronger protections, the ICA pointed out that the types of scams affecting the insurance industry differ from those targeting banks. Common scams involving insurers include phishing schemes, fraudulent insurance websites, and misleading requests for claim processing fees. The industry also sees a rise in scam activity following natural disasters, as fraudsters exploit consumers seeking urgent claim settlements.
During its submission to the Senate committee, the ICA made several recommendations for refining the bill, including:
The ICA also called for increased data-sharing across industries to strengthen scam prevention efforts.
