Interview with 4BC on how banks are combatting scams

Gary Hardgrave (Host): To the story, Christine Rose and her husband, David, they fell victim to a vicious, really vicious scam. It’s robbed them of $40,000 the money was the house deposit for their first property purchased together. It’s all gone because a cyber-criminal impersonated their solicitor.  

Christine Rose (clip from previous interview): It’s affected the whole family. Dave’s an absolute wreck. I’ve never seen him so upset. Yeah, he’s he finds it really hard to even talk about it. Our kids are affected. We’ve been renting for the last year. And half the time we’ve been here, the owner of the house we’re renting has been selling this property, so we’ve had open homes every second weekend, and we were just so excited to get into our own place. Yeah, so it’s absolutely gut wrenching.  

Gary Hardgrave: I mean, imagine being in that situation. Your entire life savings gone instantly. It gives you a sense of how adept these scams are now becoming, and whoever is behind this managed to shadow Christine and David’s emails, detecting the timeline in which their deposit was due, the branding style, tone of the solicitors email, and they set the most horrible of traps, which is now an investigation by police and their bank ING. Sadly, these crimes are becoming too common, too real for so many of us. So, we’ve contacted the Australian Banking Association, it’s got them on high alert. They’re creating new technology to help intercept illegal transactions like this. It’s just awful. And the CEO of the Australian Banking Association, familiar name to us all here in Queensland, Anna Bligh, is joining us. Nice to talk to Anna. How you how you doing? 

Anna Bligh (Guest): Good, how are you? Gary?  

Gary Hardgrave: Yeah, really, really, well, we appreciate your time today. I mean, this is awful, isn’t it, when we hear of these sorts of stories. 

Anna Bligh: Gary, it’s just devastating when these sort of situations happen. Obviously, I’m not privy to the specific details in this case, but what I can say is that every bank has specialist fraud teams, and I know that they’ll be doing everything possible to try and recover the funds, if that is at all possible. So, you know, my heart goes out to people in these circumstances, these scammers are not a couple of amateurs in their garage. These are very sophisticated criminal gangs. Australian police are working with banks to make arrests and to and there was one reported yesterday, a couple here in Sydney, but you know, it’s an ever-present fight against these criminals.  

Gary Hardgrave: And this is a very sophisticated, I mean, just to use, I know you don’t want to talk about specifics, and I get that I understand, respect that. But to use Christine and David as an example, their email was basically hacked, they hacked into somebody’s email server, I guess they sent money to a Commonwealth Bank Account from their ING account. The banks obviously would know who has that account, and I get it, they can’t, because of privacy laws tell Christine and David. I suspect the police are going to investigate and find out eventually, but the money could be well gone by, by the time they do. 

Anna Bligh: I can assure you that banks are able to share that information between themselves, so they will be in contact, and ING will be in contact with Commonwealth Bank, as you’ll appreciate, some of these things may not be public and not be very obvious to people, but banks are sharing intelligence about individual scams and scam trends literally every minute of the day. They’ve set up an exchange platform, these banks will be talking to each other, and they will be looking to see, often what happens – I don’t know in this case – but often, what happens is the money hops from different accounts, too often to something like a cryptocurrency platform that’s offshore, and it depends on how long that process or how short that process is, whether or not money can be recovered. But you’re absolutely right, there’s a high level of technical sophistication here. They have managed to get into the system. We’ve seen this often with trades people, where they send an invoice, a plumber sends an invoice. You think you’ve paid them, they come back in 30 days and say, where’s my money? And that’s until it’s 30 days down the track before anyone even realizes that the scam has occurred.  

What I can say is that Australian banks on this particular type of scam, there’s two things that I’d say to your listeners. One, they introduced, there is a thing called Pay ID. You can go into your banking app, you can go into your bank and they can show you how to set it up on your phone. If you are paying someone who is also using pay ID, you can pay directly to their phone number, which is a unique number. So, without going into all the technology behind it, I think one of the ways to combat specifically these kinds of email interruption scams is to use pay ID when you are paying bills, because it will go to a unique number that’s identified, that’s associated with that trades person or a solicitor, etc.  

But one of the things I think customers don’t realize is that globally, when you send to an account number, banks have until quite recently, not had the technical capability to match the account number with the name of the account. That technology is now live in the UK and the Netherlands, and Australian banks are investing in bringing that here. So, we’ll be – New Zealand is doing it at the same time – so depending on who gets there first, will be the third or the fourth banking system in the world to have the ability to match, which in this case, it would have shown immediately that that was not the solicitors bank account. So, I know that’s not much comfort to Christine and David, but to your listeners, I would say, banks are investing, this is a $100 million worth of investment to make our system one of the most resilient in the world. And it’ll be, it’ll be starting early next year. 

Gary Hardgrave: Yeah, well, I mean, obviously with Black Friday near there’s a time that scammers love, because people are sort of rushing to get that bargain and so forth. So, you might be trading with people you’ve never traded with before, and who knows what the scammers could try and do. 

Anna Bligh: Look, thanks for bringing that up. Black Friday is a real danger period we see in these major shopping events, so after Christmas sales, Black Friday, those sorts of things, scammers get very active. The two most common scams in these times are fake websites, so clever scammers fake the website of well-known brands. If you go, you know, if you see something you like on that website, go into your search engine, and go to the actual brand and see if that’s actually what is there, and see if it’s actually that price. The other one is fake parcel delivery, so if you order a stack of things, and then you’re getting a lot of parcels, in the next couple of weeks, you might be getting messages from various parcel delivery companies, don’t press on the links, don’t give over your banking information, don’t give your personal details, because it’s not just on Black Friday, it’s in the weeks afterwards, they try to trick you into making some extra payment for a delivery of a parcel that you’re expecting. And then they’ve got your details, and then they can get into your account.  

Gary Hardgrave: Yeah, indeed, they do. So, tell me, what is the chance of people getting money back after a scam like this? Given the banks, as I understand it, the criminals set up what they call a mule bank account to do the dirty work. So, they’ve legitimately opened up a bank, and obviously you got to produce your 100 points or whatever to verify who you are, but the bank account is triggered, so that when the money goes in, it’s flicked somewhere else. Is that the sort of thing that happens? So therefore, the money is gone. What’s, what’s your chance of getting money back in that scenario. 

Anna Bligh: It’s actually worse than that Gary, many of the accounts that are used by mules, sorry, used by scammers. Yes, you call them mule accounts, it’s just like when people act as a mule for drug deals. Wha they’re what they’re doing is using someone else’s account. So, the account was set up by a legitimate person who’s not a scammer. And unfortunately, in many cases, in a number of cases, people are selling their accounts or earning money by renting their accounts. They often may not know that they’re doing that with a scammer, but it’s actually illegal to sell your ID.  

It’s illegal to sell a bank account, but many people, unfortunately, are prepared to take money so that the bank might say the account was set up by Gary Hargrave, and it really was Gary Hargrave that set it up. Unfortunately, Gary then decided to make a bit of money on the side, and is renting that account to somebody else entirely, or worse, has sold the account and left the country. So, it’s quite a complex operation, these things, but banks are also implementing more biometric tests so that it’s more evident becomes more evident whether or not it’s the real person operating the account. Now, that technology that is being implemented now, but this is, it’s a whack a mole. You know, as soon as the door is closed on one kind of scam, these criminals will do their best to find another way. Once upon a time, they, you know, criminals who wanted to get your money came through the front door of a bank with a shotgun. Now they’re doing what they can to trick us at a scale that we haven’t seen before. As you know, there’s always been bad people out there who want to trick people out of their money, they’re now able to do it at a much greater scale, because technology, brings us a lot of convenience, but this is part of keeping ourselves safe online.  

Gary Hardgrave: Well, either way, I know the banking industry is looking at this scam safe accord. Obviously, there’s work to be done, continuing to be done. I appreciate your time today. I know you’ve got a lot of things on, but in the end, Anna Bligh it, it is awful if these people lose their money, but no hope of getting it back. It’s just an awful moment for them personally. But anybody, not just this case, anybody who falls for these scams, it’s tragic.  

Anna Bligh: What I would say is that banks – it’s impossible to recover every single time – but banks do actually have quite a lot of success. So, I would say to your listeners, if they are worried that the person they’re talking to on the phone, or they’re worried about money that seems to be gone out of their account, talk to their bank as soon as possible that gives the bank the best chance of recovery. And banks do exchange this kind of information in very close to real-time in a way that helps them recover in a substantial number of cases.  

Gary Hardgrave: All right, okay, good, nice to talk to you, Anna Bligh, thank you very much for your time. 

Ends 

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