Westpac gives update on Scam-Safe Accord

Eight months after the initial announcement, Westpac has provided an update on the progress made via the accord.

“We are all part of the value chain for customers. Financial services industry participants are working together to minimise the impact of scams and fraud. The issues these create are an impost to our customers and the economy as a whole,” said Peta O’Brien, managing director, client engagement, global transaction services at Westpac.

“We have significant resources pointed towards managing the risks and outcomes of fraud and scams. These are resources I am sure we and our customers wish were engaged in other client focused activities that created economic benefits. So, it’s important we all work together to reduce the potential for scams and frauds to occur.”

A major issue with modern cyber crime is the sophistication of attacks. According to Ben Young, Westpac’s head of fraud and financial crime insights, addressing the ever-changing landscape of cyber security is a key concern.

“The accord will standardise many of the fraud and scam controls across the various banks so that no weak link will be left where scammers can focus. Having initiatives focused on the receiving bank party also, is a key step forward of the accord,” he said.

“Australians are still losing millions of dollars to scams every month, so it’s important to keep the pressure on and to keep innovating on ways to prevent scams.

“When the Scam-Safe Accord measures are in place, scammers aren’t just going to roll over and say: ‘Oh well, it’s all too hard, so now let’s stop scamming’. We know that they will change their methods and try new things. This initiative will certainly make it harder for them, but they will try to evolve around that.”

The ACCC revealed that in 2023, 601,000 scam reports were filed across Australia, culminating in losses of $2.74 billion. With 15.4 billion transactions equating to $2.5 trillion happening annually, securing safety in banking is crucial.

Westpac detailed some of the changes expected to be made through the accord: “The Scam-Safe Accord between Australia’s commercial banks, building societies, credit unions and community-owned banks is built on six initiatives. These include biometric checks to prevent misuse of bank accounts; warnings and payment delays to alert customers to potential scam payments; a major expansion of intelligence-sharing across the sector; limiting payments to high-risk channels; implementing an anti-scams strategy; and an AUD 100 million investment in a new industry-wide ‘confirmation of payee’ (CoP) system.”

Westpac’s executive director, head of new payments and payments policy Chris Campbell, detailed the importance of these changes.

“The most material are the CoP piece and the biometrics for onboarding. When you make a payment in Australia at present, you give the BSB, account number and the name that you want to pay and, while that BSB and account number are validated, the name is there really for your own labelling,” said Campbell.

“However, at the end of the accord’s delivery, you will get confirmation that the name matches the recipient account and that will be quite a big change for those many millions of payments.”

Young added: “The biometric check, such as fingerprint or the customer’s face, will be required for new customers opening accounts to verify their identity. Once all the banks are collecting a biometric, it will help to standardise at a higher level the quality of onboarding for new customers.”

The Scam-Safe Accord will reportedly roll out changes from now until the end of 2025.

“These kinds of initiatives are aimed at reducing scams occurring with the recipient being confirmed as the party the payer believes they are paying and alerting them to take action if necessary, through more due diligence or not making the payment at all. As we move to a real time payment environment, there is less time and friction for incorrect payments to be stopped, so it is critical we provide as much information as possible to give payers certainty,” said O’Brien.

“It’s not just consumers that are financially impacted – but also small and large organisations who are losing funds through scams such as business email compromise, so it impacts all parts of society.”

[Related: Banks launch ‘new offensive in the war on scams’]

Jack Campbell is the editor of Broker Daily. After graduating from the University of Wollongong in 2022, Jack began his journalistic career working on Broker Daily’s sister brand, HR Leader. In August 2023 he was made the news editor and worked alongside some talented journalists writing articles and recording podcasts.

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