1 00:00:05,680 --> 00:00:08,360 Speaker 1: Welcome to the Fear and Greed Business Interview. I'm sure Ailma. 2 00:00:08,600 --> 00:00:12,600 Speaker 1: This week is Scams Awareness. It's part of a national 3 00:00:12,640 --> 00:00:15,960 Speaker 1: effort to improve awareness of the warning signs of scams, 4 00:00:16,200 --> 00:00:19,360 Speaker 1: which are becoming more common, more advanced, and more deceptive. 5 00:00:19,680 --> 00:00:22,520 Speaker 1: Shaq Johnson is the head of Customer Protection at A 6 00:00:22,600 --> 00:00:25,520 Speaker 1: and Z. He's also the chair of the Australian Financial 7 00:00:25,560 --> 00:00:28,160 Speaker 1: Crime Exchange SHACK. Welcome to Fear and Greed. 8 00:00:28,600 --> 00:00:29,560 Speaker 2: Thanks for having Michael. 9 00:00:30,280 --> 00:00:33,000 Speaker 1: Who's winning the scammers are the consumers at the moment? 10 00:00:33,680 --> 00:00:36,680 Speaker 2: Well at this point, definitely the scammers. As you pointed out, Sean, 11 00:00:36,920 --> 00:00:42,120 Speaker 2: they are definitely sophisticated. There are organized crime syndicates that 12 00:00:42,159 --> 00:00:46,080 Speaker 2: are behind these scams. So although we're seeing some good 13 00:00:46,120 --> 00:00:49,560 Speaker 2: reduction in scam losses this year, there are a lot 14 00:00:49,560 --> 00:00:53,040 Speaker 2: of consumers that are being scammed, a lot of money 15 00:00:53,080 --> 00:00:56,040 Speaker 2: that is being lost, and not to mention the emotional 16 00:00:56,920 --> 00:01:00,640 Speaker 2: impact that scams has on consumers. I think the scams 17 00:01:00,640 --> 00:01:03,240 Speaker 2: are winning at this point, but we are seeing some 18 00:01:03,800 --> 00:01:07,440 Speaker 2: signs of our guess recovery and we are cautiously optimistic, 19 00:01:07,480 --> 00:01:08,560 Speaker 2: but there's a lot more to do. 20 00:01:09,520 --> 00:01:13,000 Speaker 1: Okay, So Scams Awareness Week, what are the most typical 21 00:01:13,120 --> 00:01:16,559 Speaker 1: scams that bank customers are seeing at the moment. 22 00:01:18,000 --> 00:01:20,880 Speaker 2: There are plenty of scam types unfortunately, and they continue 23 00:01:20,920 --> 00:01:23,920 Speaker 2: to evolve. But I'll just cover on the most I 24 00:01:23,920 --> 00:01:26,479 Speaker 2: guess concerning scam types that we see in at the moment, 25 00:01:27,080 --> 00:01:30,840 Speaker 2: and I'll start with the impersonation scam. So those criminals 26 00:01:31,680 --> 00:01:37,560 Speaker 2: impersonate banks, Australian Taxation Office, telcos and other organizations. And 27 00:01:37,640 --> 00:01:40,440 Speaker 2: if I can maybe focus on how they personate banks, 28 00:01:40,440 --> 00:01:43,520 Speaker 2: because that's probably the most sophisticated that we've seen in 29 00:01:43,600 --> 00:01:48,160 Speaker 2: recent months and years. But the scam essentially involves the 30 00:01:48,240 --> 00:01:51,560 Speaker 2: victim receiving a text message claiming to me from the bank, 31 00:01:52,160 --> 00:01:55,840 Speaker 2: and they often pretend or claim that there are some 32 00:01:56,040 --> 00:02:00,760 Speaker 2: suspicious activities on the customer's account, and they encourage the 33 00:02:00,840 --> 00:02:04,840 Speaker 2: victim to call a number, and then when the victim 34 00:02:04,880 --> 00:02:06,920 Speaker 2: calls that number, they speak to somebody claiming to be 35 00:02:06,960 --> 00:02:10,000 Speaker 2: from the bank security department. And then in that conversation, 36 00:02:10,360 --> 00:02:14,320 Speaker 2: again they use fear tactics to say your account is compromise, 37 00:02:14,400 --> 00:02:16,200 Speaker 2: your money is unsafe, and we need you to move 38 00:02:16,240 --> 00:02:19,720 Speaker 2: your money to another account, and that account has been 39 00:02:19,760 --> 00:02:23,400 Speaker 2: opened by the scammers. And once the victim moves the money. 40 00:02:23,680 --> 00:02:26,120 Speaker 2: The scammers will be waiting on the other on the 41 00:02:26,160 --> 00:02:28,600 Speaker 2: other end for the funds to land, and then the 42 00:02:28,639 --> 00:02:32,840 Speaker 2: funds will move two different either financial institutions or commonly 43 00:02:33,120 --> 00:02:35,560 Speaker 2: will we see funds go to crypto and once they 44 00:02:35,600 --> 00:02:39,160 Speaker 2: head the crypto wallet, they sort of disappear on a blockchain. 45 00:02:40,040 --> 00:02:42,160 Speaker 2: So that's probably one of the most concerning ones that 46 00:02:42,160 --> 00:02:46,040 Speaker 2: we see. Business email compromise or also referred to as 47 00:02:46,160 --> 00:02:51,839 Speaker 2: invoice redirection scam is becoming increasingly common and this can 48 00:02:51,880 --> 00:02:55,760 Speaker 2: have quite a devastating impact on consumers and small businesses. 49 00:02:56,320 --> 00:03:01,560 Speaker 2: And what that scam involves is the victim receiving an 50 00:03:01,600 --> 00:03:06,240 Speaker 2: invoice either from a builder or from a conveyantioner or 51 00:03:06,280 --> 00:03:09,360 Speaker 2: from a known supplier, and again there's an element of 52 00:03:09,360 --> 00:03:13,040 Speaker 2: impersonation there, and once the email is received, there is 53 00:03:13,400 --> 00:03:17,839 Speaker 2: often an invoice with a payment instruction, and those payments 54 00:03:17,960 --> 00:03:21,760 Speaker 2: then go to the scammers. Unfortunately, we've seen consumers that 55 00:03:21,800 --> 00:03:24,079 Speaker 2: are building a house or they're just settling on their 56 00:03:24,120 --> 00:03:29,440 Speaker 2: property or either a residential or commercial property. The scammers 57 00:03:29,520 --> 00:03:32,640 Speaker 2: know because they have compromised an email account, they have 58 00:03:32,720 --> 00:03:36,120 Speaker 2: intercepted communication between the customer and the conveyancer or the 59 00:03:36,160 --> 00:03:38,440 Speaker 2: lawyer or the real estate, and they know there is 60 00:03:38,560 --> 00:03:41,360 Speaker 2: a payment that is about to be made, and then 61 00:03:41,480 --> 00:03:45,040 Speaker 2: they will send a fraudulent invoice instructing the victims to 62 00:03:45,080 --> 00:03:48,080 Speaker 2: pay the money to a different account, and that account 63 00:03:48,120 --> 00:03:50,040 Speaker 2: is controlled by the scammers. 64 00:03:50,880 --> 00:03:53,400 Speaker 1: Now I'll go into what A and zed's doing about 65 00:03:53,600 --> 00:03:55,960 Speaker 1: preventing schemes in a moment, but before we get there, 66 00:03:56,600 --> 00:03:58,880 Speaker 1: when you're a customer, and I would get at least 67 00:03:59,000 --> 00:04:03,520 Speaker 1: a phone call AD often more explaining to me that 68 00:04:03,800 --> 00:04:06,200 Speaker 1: something's been compromised, you know, and you hang up or 69 00:04:06,600 --> 00:04:09,280 Speaker 1: it may not sometimes recorded message. Sometimes it's not a 70 00:04:09,320 --> 00:04:13,080 Speaker 1: recorded message. It's an individual What should you do, like 71 00:04:13,120 --> 00:04:15,480 Speaker 1: if you have any when you receive a phone call 72 00:04:15,600 --> 00:04:17,640 Speaker 1: like that, what's the first thing to do? 73 00:04:18,640 --> 00:04:21,280 Speaker 2: I think the first thing we encourage customers to do 74 00:04:21,400 --> 00:04:25,880 Speaker 2: is pause. You know, As I mentioned previously, scammers use 75 00:04:26,000 --> 00:04:31,480 Speaker 2: fear and urgency to make consumers do certain things, like 76 00:04:31,520 --> 00:04:33,680 Speaker 2: your account is compromise and if you don't move your money, 77 00:04:33,680 --> 00:04:36,200 Speaker 2: you're going to lose your money. One thing I'd say 78 00:04:36,240 --> 00:04:40,280 Speaker 2: that if the money is in your account and there's 79 00:04:40,360 --> 00:04:43,720 Speaker 2: unauthorized access to your money, the bank will typically if 80 00:04:43,720 --> 00:04:46,480 Speaker 2: you haven't been involved, you haven't contributed to the loss. 81 00:04:46,520 --> 00:04:49,440 Speaker 2: The bank will compensate you for that loss. So the 82 00:04:49,680 --> 00:04:51,560 Speaker 2: premise of the money is unsafe, you need to move it, 83 00:04:51,600 --> 00:04:53,120 Speaker 2: and the bank is asking you to move, So pay 84 00:04:53,160 --> 00:04:56,520 Speaker 2: attention to what you've been asked to do. Any communication, 85 00:04:56,560 --> 00:04:59,560 Speaker 2: any form of communication, whether it's through a text message, 86 00:04:59,560 --> 00:05:03,520 Speaker 2: your phone call, or an email social media platform, that 87 00:05:03,640 --> 00:05:06,320 Speaker 2: is asking you to act with urgency, you need to 88 00:05:06,360 --> 00:05:09,360 Speaker 2: be extremely suspicious. And one of the things that we 89 00:05:09,440 --> 00:05:12,400 Speaker 2: often ask our customers to do is if it's a 90 00:05:12,400 --> 00:05:16,039 Speaker 2: communication claiming to be from your bank, pick up the 91 00:05:16,080 --> 00:05:18,840 Speaker 2: phone and speak or call you a bank on a 92 00:05:18,920 --> 00:05:22,039 Speaker 2: number that is published on their profile, on our website, 93 00:05:22,720 --> 00:05:25,320 Speaker 2: or on the back of the card, and speak to 94 00:05:25,400 --> 00:05:27,880 Speaker 2: your bank and you can ask them these questions. But again, 95 00:05:27,920 --> 00:05:29,640 Speaker 2: the bank will never ask you to move your money 96 00:05:29,640 --> 00:05:32,880 Speaker 2: out of your account. If we have concerns, then we 97 00:05:32,920 --> 00:05:35,400 Speaker 2: will call you directly. We will not ask it for 98 00:05:35,440 --> 00:05:38,120 Speaker 2: your personal details. We will not ask you to move 99 00:05:38,120 --> 00:05:40,360 Speaker 2: your money out of your account. Your money is safe 100 00:05:40,400 --> 00:05:43,039 Speaker 2: where it is, and we have measures in place to 101 00:05:43,120 --> 00:05:45,799 Speaker 2: protect your profile or your account. If we have suspicion 102 00:05:45,839 --> 00:05:47,720 Speaker 2: that your account has compromised. 103 00:05:47,760 --> 00:05:52,960 Speaker 1: Stay with me, Shack. We'll be back in a minute. 104 00:05:56,200 --> 00:05:59,160 Speaker 1: I'm speaking to Shaq Johnson, head of customer Protection at 105 00:05:59,200 --> 00:06:03,280 Speaker 1: A and Z. So there's a really important new ones 106 00:06:03,360 --> 00:06:06,240 Speaker 1: in what you've just been talking about. Mostly customers will 107 00:06:06,279 --> 00:06:10,000 Speaker 1: get their money back if they haven't acted. It's kind 108 00:06:10,040 --> 00:06:12,640 Speaker 1: of how you put it. Whereas if someone rings you 109 00:06:12,680 --> 00:06:14,680 Speaker 1: and you make a move, and you move your money 110 00:06:14,680 --> 00:06:19,960 Speaker 1: because you've been scammed, then presumably you're less likely because 111 00:06:20,000 --> 00:06:23,479 Speaker 1: you've actually taken the action yourself, you're less able to 112 00:06:23,640 --> 00:06:26,880 Speaker 1: get the money back, be that through the bank or 113 00:06:26,920 --> 00:06:30,120 Speaker 1: through some other third party, Versus if you do nothing, 114 00:06:31,240 --> 00:06:32,720 Speaker 1: then you're more likely to get with the money back. 115 00:06:32,720 --> 00:06:33,800 Speaker 1: Do you know what I'm trying to say there? 116 00:06:33,920 --> 00:06:37,440 Speaker 2: That's absolutely right your spot on, Sean. If your account 117 00:06:37,960 --> 00:06:41,280 Speaker 2: is compromised or has been hacked, or your credentials, your 118 00:06:41,279 --> 00:06:44,799 Speaker 2: credit card details or your internet banking has been compromised 119 00:06:44,839 --> 00:06:47,840 Speaker 2: by our unknown third party, haven't contributed to it, your 120 00:06:47,880 --> 00:06:50,960 Speaker 2: money has moved, then most banks in Australia have a 121 00:06:51,000 --> 00:06:54,640 Speaker 2: money back or fraud money back guarantee. Yeah, and if 122 00:06:54,680 --> 00:06:58,640 Speaker 2: you've contributed to or you've made the payment yourself, it's 123 00:06:58,800 --> 00:07:01,560 Speaker 2: a lot harder for the for the bank to detect 124 00:07:02,200 --> 00:07:05,440 Speaker 2: those payments. Yes, we've invested heavily to detect and prevent scams. 125 00:07:05,920 --> 00:07:07,760 Speaker 2: But if you're making the payment yourself, a it's a 126 00:07:07,800 --> 00:07:09,640 Speaker 2: lot harder for the bank to detect that because it's 127 00:07:09,640 --> 00:07:13,320 Speaker 2: coming from your known device, your trusted IP address. But 128 00:07:13,400 --> 00:07:15,600 Speaker 2: the other thing that I would say is once you've 129 00:07:15,600 --> 00:07:18,800 Speaker 2: made the payment, it's incredibly difficult to recover, So the 130 00:07:19,320 --> 00:07:21,600 Speaker 2: success of recovery is really low, especially if it goes 131 00:07:21,640 --> 00:07:25,840 Speaker 2: to some of those non traditional accounts like crypto exchanges 132 00:07:25,880 --> 00:07:27,640 Speaker 2: and some other money remittance companies. 133 00:07:28,240 --> 00:07:31,960 Speaker 1: Okay, so Ainz is investing a lot in preventing scams. 134 00:07:32,160 --> 00:07:34,680 Speaker 1: Take me through some of the measures, like the scam 135 00:07:34,880 --> 00:07:35,680 Speaker 1: scoring model. 136 00:07:36,320 --> 00:07:39,600 Speaker 2: Sure, I'll probably start with education. It's probably one of 137 00:07:39,680 --> 00:07:42,760 Speaker 2: the things that we focused heavily on is raising awareness. 138 00:07:43,400 --> 00:07:46,800 Speaker 2: So we've introduced a lot of content on our az 139 00:07:46,920 --> 00:07:50,240 Speaker 2: dot com around emerging scam types and some of the 140 00:07:50,240 --> 00:07:52,400 Speaker 2: common red flags for our customers to look at for. 141 00:07:53,120 --> 00:07:57,760 Speaker 2: We also introduced personalized warning messages in our digital channels. 142 00:07:57,800 --> 00:08:00,680 Speaker 2: When customers are performing a particular activity or transaction, than 143 00:08:00,760 --> 00:08:03,960 Speaker 2: they are introduced with a particular warning message relevant to 144 00:08:04,000 --> 00:08:06,920 Speaker 2: what we think this customer is doing. We do believe 145 00:08:06,960 --> 00:08:09,560 Speaker 2: that prevention is better than a cure and being a 146 00:08:09,600 --> 00:08:13,240 Speaker 2: scam awareness. We do put a lot of emphasis on 147 00:08:13,360 --> 00:08:16,920 Speaker 2: raising awareness, sharing some of the common scam types and 148 00:08:16,960 --> 00:08:19,880 Speaker 2: some of the red flags that present and for customers 149 00:08:19,880 --> 00:08:22,080 Speaker 2: to be on the lookout. So we invested heavily in 150 00:08:22,200 --> 00:08:27,520 Speaker 2: raising awareness amongst our customers. The second thing, we've implemented 151 00:08:27,840 --> 00:08:30,600 Speaker 2: biometrics capability across all of our digital channels from the 152 00:08:30,600 --> 00:08:33,800 Speaker 2: moment somebody opens an account to the moment they transact, 153 00:08:34,440 --> 00:08:38,800 Speaker 2: so this helps us identify any unusual activity or on 154 00:08:38,800 --> 00:08:43,440 Speaker 2: our digital channels. How customers interact with our digital channels 155 00:08:44,040 --> 00:08:46,520 Speaker 2: is something that we look at to help us identify 156 00:08:46,559 --> 00:08:50,960 Speaker 2: any anomalies or any suspicious activity. You mentioned the scam 157 00:08:51,320 --> 00:08:55,720 Speaker 2: detection model that we've introduced recently. You would have seen 158 00:08:55,800 --> 00:08:59,520 Speaker 2: or heard about our Falcon platform. So our Falcon platform 159 00:09:00,200 --> 00:09:04,400 Speaker 2: is essentially our risk engen. It receives more than eight 160 00:09:04,800 --> 00:09:08,520 Speaker 2: million payments per day and more than seven million non 161 00:09:08,559 --> 00:09:12,760 Speaker 2: payment or non monetary data signals from different sources including 162 00:09:12,800 --> 00:09:16,760 Speaker 2: our digital channels, including external sources. We also receive data 163 00:09:16,760 --> 00:09:20,120 Speaker 2: from the Australian Financial Crimate Exchange into our digital platform, 164 00:09:20,240 --> 00:09:23,560 Speaker 2: into our Falcon platform, and what that helps us to 165 00:09:23,559 --> 00:09:26,840 Speaker 2: do is to understand or make sense of the activity 166 00:09:26,880 --> 00:09:29,760 Speaker 2: that is being performed, whether it's a payment through a 167 00:09:29,800 --> 00:09:32,640 Speaker 2: digital channel or whether a payment on a card, and 168 00:09:32,760 --> 00:09:35,840 Speaker 2: all of those data signals help us detect and prevent 169 00:09:36,559 --> 00:09:39,199 Speaker 2: fraud and scams with much better precision that we used 170 00:09:39,200 --> 00:09:39,800 Speaker 2: to in the past. 171 00:09:40,760 --> 00:09:44,680 Speaker 1: Okay, just finally, the banking is an incredibly competitive industry 172 00:09:44,679 --> 00:09:47,240 Speaker 1: in Australia. We've got four majors going out at Hammer 173 00:09:47,280 --> 00:09:51,920 Speaker 1: and Tong. However, when it comes to trying to work 174 00:09:51,960 --> 00:09:54,640 Speaker 1: on scams, the banks actually do cooperate quite a bit, 175 00:09:54,679 --> 00:09:55,120 Speaker 1: don't they. 176 00:09:55,480 --> 00:09:58,760 Speaker 2: We absolutely do, and we always say that there's no 177 00:09:58,880 --> 00:10:03,720 Speaker 2: competitive advantage when comes to fighting fraud, scams and financial crime. 178 00:10:04,160 --> 00:10:06,040 Speaker 2: We all in it together. We have a common enemy. 179 00:10:06,600 --> 00:10:08,520 Speaker 2: We all want to win, but we don't want the 180 00:10:08,520 --> 00:10:11,000 Speaker 2: others to lose. Because of the others lose, everyone loses. 181 00:10:11,040 --> 00:10:15,200 Speaker 2: So we absolutely do collaborate. We compare best practices, we 182 00:10:15,240 --> 00:10:17,640 Speaker 2: talk about trends that we're seeing, we talk about successes, 183 00:10:17,640 --> 00:10:20,000 Speaker 2: we talk about what's working and what's not working. But 184 00:10:20,000 --> 00:10:23,079 Speaker 2: most impromptly, as you point it out, with regards to 185 00:10:23,120 --> 00:10:25,640 Speaker 2: the AFCX, there was training financial Crime Exchange. We do 186 00:10:25,720 --> 00:10:28,679 Speaker 2: exchange a lot of data, so all of the member 187 00:10:28,720 --> 00:10:32,920 Speaker 2: banks consume and upload a huge amount of data on 188 00:10:32,960 --> 00:10:37,360 Speaker 2: a daily basis to help banks within that ecosystem detect 189 00:10:37,400 --> 00:10:38,640 Speaker 2: and prevent scams and fraud. 190 00:10:39,080 --> 00:10:41,200 Speaker 1: Fantastic Shaq, thank you very much for talking to Fear 191 00:10:41,240 --> 00:10:41,600 Speaker 1: and Greed. 192 00:10:42,000 --> 00:10:42,959 Speaker 2: Thanks for having me Shaan. 193 00:10:43,480 --> 00:10:46,200 Speaker 1: There was Shack Johnson, head of customer protection at A 194 00:10:46,320 --> 00:10:48,360 Speaker 1: and Z. This is a Fear and Greed business interview. 195 00:10:48,440 --> 00:10:50,520 Speaker 1: Join us every morning for the full of us say 196 00:10:50,600 --> 00:10:52,880 Speaker 1: our fear and greed. Daily business news for people who 197 00:10:52,920 --> 00:11:00,120 Speaker 1: make their own decisions. I'm chanelma Enjoy your day.