1 00:00:03,900 --> 00:00:07,710 Sean Aylmer: Welcome to the Fear and Greed Daily Interview. I'm Sean Aylmer. Scams 2 00:00:07,710 --> 00:00:10,860 Sean Aylmer: seem to be everywhere right now from fake toll road 3 00:00:10,860 --> 00:00:14,100 Sean Aylmer: text messages to endless recorded calls claiming to be from 4 00:00:14,100 --> 00:00:16,860 Sean Aylmer: Amazon or PayPal or the tax office. They're a little 5 00:00:16,860 --> 00:00:18,930 Sean Aylmer: hard to avoid. It might come as a bit of 6 00:00:18,930 --> 00:00:22,500 Sean Aylmer: a surprise then to learn that many Australians aren't aware 7 00:00:22,530 --> 00:00:26,160 Sean Aylmer: of the dangers of cyber criminals. New research by National 8 00:00:26,160 --> 00:00:29,220 Sean Aylmer: Australia Bank shows young people aged 18 to 29 are 9 00:00:29,220 --> 00:00:32,340 Sean Aylmer: the least concerned about becoming a victim, yet are among 10 00:00:32,340 --> 00:00:34,860 Sean Aylmer: the most likely to lose out to a scam or 11 00:00:34,860 --> 00:00:39,300 Sean Aylmer: cyber attack. Chris Sheehan is Executive, Group Investigations and Fraud 12 00:00:39,300 --> 00:00:42,390 Sean Aylmer: at NAB. He also spent 27 years at the Australian 13 00:00:42,390 --> 00:00:45,449 Sean Aylmer: Federal Police, so has a unique insight into this problem. Chris, 14 00:00:45,450 --> 00:00:46,500 Sean Aylmer: welcome to Fear and Greed. 15 00:00:47,310 --> 00:00:48,000 Chris Sheehan: Hi, how are you? 16 00:00:48,930 --> 00:00:52,200 Sean Aylmer: Look how big a problem do we have with scams? 17 00:00:52,200 --> 00:00:55,050 Sean Aylmer: We hear about them, we talk about them. Just how 18 00:00:55,050 --> 00:00:55,890 Sean Aylmer: big is the issue? 19 00:00:56,910 --> 00:01:01,050 Chris Sheehan: So I call it a global crime epidemic or a 20 00:01:01,050 --> 00:01:04,170 Chris Sheehan: global crime wave that is not hyperbole and that is 21 00:01:04,170 --> 00:01:08,700 Chris Sheehan: not exaggeration. This is a massive problem. In the UK, 22 00:01:09,209 --> 00:01:12,660 Chris Sheehan: the government there has classified the fraud and scams problems 23 00:01:12,660 --> 00:01:16,289 Chris Sheehan: that they are facing as a national security issue. We 24 00:01:16,290 --> 00:01:18,959 Chris Sheehan: are in the same position here and whilst the government here hasn't 25 00:01:18,959 --> 00:01:22,650 Chris Sheehan: said that yet, to your intro the impact of this 26 00:01:22,650 --> 00:01:27,060 Chris Sheehan: across our society across our community is enormous. There'd be 27 00:01:27,060 --> 00:01:29,100 Chris Sheehan: very, very few people who are listening to this right 28 00:01:29,100 --> 00:01:32,100 Chris Sheehan: now who haven't at least been targeted at least once 29 00:01:32,100 --> 00:01:33,480 Chris Sheehan: by these organized crime groups. 30 00:01:34,650 --> 00:01:38,100 Sean Aylmer: Are there many, many more now than previously? Why is 31 00:01:38,100 --> 00:01:40,050 Sean Aylmer: it that the ATO just keeps ringing me with a 32 00:01:40,050 --> 00:01:41,819 Sean Aylmer: recorded message saying I owe money? 33 00:01:42,720 --> 00:01:44,340 Chris Sheehan: Well, maybe you do, Sean. We've got to check that out. 34 00:01:45,390 --> 00:01:46,740 Sean Aylmer: Good point. I hadn't thought of that. 35 00:01:46,740 --> 00:01:51,840 Chris Sheehan: Yeah, no look, the reason for this is there definitely are 36 00:01:52,200 --> 00:01:55,410 Chris Sheehan: many more scams around now than there was say, five 37 00:01:55,410 --> 00:01:59,580 Chris Sheehan: to 10 years ago. Partly that's because we have moved 38 00:01:59,580 --> 00:02:02,880 Chris Sheehan: to a true digital economy. Everything is done online now, 39 00:02:02,880 --> 00:02:08,880 Chris Sheehan: not just banking, but sharing of information, communications, business of 40 00:02:08,880 --> 00:02:12,780 Chris Sheehan: all kinds, purchasing. Everything is in an online environment, in 41 00:02:12,780 --> 00:02:17,610 Chris Sheehan: a digital environment. And whilst that comes with enormous convenience 42 00:02:17,700 --> 00:02:21,780 Chris Sheehan: for consumers and for governments and for businesses, it also 43 00:02:21,780 --> 00:02:24,900 Chris Sheehan: creates a lot more opportunities for criminal groups to access 44 00:02:24,900 --> 00:02:30,270 Chris Sheehan: vastly more potential victims at very little financial costs to themselves, 45 00:02:30,330 --> 00:02:33,360 Chris Sheehan: comparably little financial cost to themselves and even less risk 46 00:02:33,360 --> 00:02:36,930 Chris Sheehan: of apprehension. So the way we live, particularly in modern 47 00:02:36,930 --> 00:02:43,200 Chris Sheehan: western societies like Australia, has unfortunately lent itself to exploitation 48 00:02:43,200 --> 00:02:44,399 Chris Sheehan: by criminal groups. 49 00:02:45,000 --> 00:02:47,760 Sean Aylmer: What are some of the most brazen scams you've seen? 50 00:02:48,510 --> 00:02:51,990 Chris Sheehan: Wow, look, one that's been doing the rounds over the 51 00:02:51,990 --> 00:02:54,540 Chris Sheehan: last few months has been a really significant problem for NAB, 52 00:02:54,600 --> 00:02:58,889 Chris Sheehan: but for other banks as well are the impersonation, fishing 53 00:02:58,889 --> 00:03:03,030 Chris Sheehan: slash spoofing scams that we've seen. So these ones involve 54 00:03:03,389 --> 00:03:06,419 Chris Sheehan: customer receiving a text message, which appears to come from 55 00:03:06,450 --> 00:03:08,790 Chris Sheehan: their bank, let's say NAB in this case, because it 56 00:03:08,790 --> 00:03:12,480 Chris Sheehan: drops into the legitimate text thread on their phone that says NAB. 57 00:03:13,320 --> 00:03:14,880 Chris Sheehan: And typically what it will do is it will tell 58 00:03:14,880 --> 00:03:17,550 Chris Sheehan: the customer or ask the customer to click on a link. 59 00:03:17,910 --> 00:03:19,530 Chris Sheehan: Customer will click on the link, it will give them 60 00:03:19,530 --> 00:03:22,680 Chris Sheehan: a phone number. In the text message, it will also say a 61 00:03:22,680 --> 00:03:25,530 Chris Sheehan: version of, " There's been an unusual transaction on your account 62 00:03:25,530 --> 00:03:28,500 Chris Sheehan: or your account has been compromised." When the customer clicks 63 00:03:28,500 --> 00:03:30,570 Chris Sheehan: on the link, they then go to a phone number, 64 00:03:30,570 --> 00:03:32,610 Chris Sheehan: they ring the phone number, and they'll speak to who 65 00:03:32,610 --> 00:03:36,870 Chris Sheehan: they believe is a NAB, either fraud center operative or 66 00:03:36,870 --> 00:03:39,000 Chris Sheehan: a NAB employee of some kind who will have a 67 00:03:39,000 --> 00:03:41,940 Chris Sheehan: story for them. The crux of that story is your 68 00:03:41,940 --> 00:03:44,940 Chris Sheehan: account's compromised. We've very helpfully opened another account for you 69 00:03:44,940 --> 00:03:48,060 Chris Sheehan: to transfer your money to keep it safe. Customers will 70 00:03:48,060 --> 00:03:50,460 Chris Sheehan: then transfer their money across. And in a number of 71 00:03:50,460 --> 00:03:53,160 Chris Sheehan: these cases, as soon as they've done that, the person 72 00:03:53,160 --> 00:03:55,860 Chris Sheehan: they're speaking to who is, of course, the scammer will 73 00:03:56,130 --> 00:03:58,380 Chris Sheehan: tell them that, ha ha, bad luck. You've been scammed. 74 00:03:58,380 --> 00:04:01,050 Chris Sheehan: I've got your money. How stupid are you? And terminate 75 00:04:01,050 --> 00:04:03,180 Chris Sheehan: the phone call and the customers lost their money. 76 00:04:03,630 --> 00:04:06,210 Sean Aylmer: And does it happen, people do lose their money? 77 00:04:06,660 --> 00:04:10,110 Chris Sheehan: Yes, they do. Without going to exact numbers for NAB 78 00:04:10,440 --> 00:04:14,070 Chris Sheehan: across industry, we're talking about millions and millions of dollars 79 00:04:14,070 --> 00:04:16,020 Chris Sheehan: that are being lost to these types of scams over 80 00:04:16,020 --> 00:04:16,890 Chris Sheehan: the last few months. 81 00:04:17,310 --> 00:04:19,410 Sean Aylmer: So I mean, if I get one of the... And 82 00:04:19,410 --> 00:04:23,730 Sean Aylmer: I have received a text message from my bank, which 83 00:04:23,730 --> 00:04:27,540 Sean Aylmer: was in line with the previous text messages I've got. 84 00:04:27,750 --> 00:04:29,640 Sean Aylmer: I looked at what they wanted me to push on 85 00:04:29,640 --> 00:04:32,400 Sean Aylmer: and that wasn't familiar, so I did nothing. What do 86 00:04:32,400 --> 00:04:35,040 Sean Aylmer: you do? If in doubt, is it all about doing 87 00:04:35,040 --> 00:04:37,830 Sean Aylmer: nothing but ring your bank off the number that you 88 00:04:37,830 --> 00:04:40,440 Sean Aylmer: know should be ringing them? What should I have done? 89 00:04:41,040 --> 00:04:43,140 Chris Sheehan: Sean, you did exactly the right thing in terms of 90 00:04:43,140 --> 00:04:48,089 Chris Sheehan: not actioning anything. What I always say is the digital economy, 91 00:04:48,089 --> 00:04:52,529 Chris Sheehan: digital environment, digital banking brings enormously more benefits than it 92 00:04:52,529 --> 00:04:56,490 Chris Sheehan: does disadvantages. But there are risks. And one of the 93 00:04:56,490 --> 00:04:59,940 Chris Sheehan: things I tell people is be curious and suspicious about 94 00:05:00,000 --> 00:05:04,440 Chris Sheehan: anything you get via a text message, a WhatsApp, an email, 95 00:05:04,529 --> 00:05:07,739 Chris Sheehan: or even a phone call. Be curious, ask questions. And 96 00:05:08,670 --> 00:05:12,029 Chris Sheehan: if what comes with it is a call to action 97 00:05:12,029 --> 00:05:14,580 Chris Sheehan: to click on a link or a call to move 98 00:05:14,580 --> 00:05:17,339 Chris Sheehan: money to another account and creates that sense of urgency 99 00:05:17,339 --> 00:05:20,549 Chris Sheehan: that if you don't do something bad will happen, do 100 00:05:20,550 --> 00:05:22,679 Chris Sheehan: not act on it. The one thing to bear in 101 00:05:22,680 --> 00:05:24,330 Chris Sheehan: mind here is that if you leave your money in 102 00:05:24,330 --> 00:05:28,620 Chris Sheehan: your bank account and someone somehow manages to actually hack 103 00:05:28,620 --> 00:05:31,710 Chris Sheehan: into your account and steal your money, and you have 104 00:05:31,710 --> 00:05:35,130 Chris Sheehan: no role in that, you don't conduct the payment yourself, 105 00:05:35,130 --> 00:05:38,460 Chris Sheehan: you don't provide any of your credentials or passwords or 106 00:05:38,460 --> 00:05:40,830 Chris Sheehan: anything like that, if that's just a straight out external hack 107 00:05:40,830 --> 00:05:43,620 Chris Sheehan: into your account and you lose your money, your bank 108 00:05:43,620 --> 00:05:46,680 Chris Sheehan: will pay you back. Your bank will accept liability for that. 109 00:05:46,680 --> 00:05:49,320 Chris Sheehan: But the moment you hit send on the payment or 110 00:05:49,320 --> 00:05:52,560 Chris Sheehan: you share your banking credentials, your login details or tokens, 111 00:05:53,070 --> 00:05:55,529 Chris Sheehan: well that becomes an authorised payment then. And the reality 112 00:05:55,529 --> 00:05:58,890 Chris Sheehan: is it's most unlikely that your bank will, A, repay 113 00:05:58,890 --> 00:06:02,040 Chris Sheehan: you for any loss, and B, because of how quickly 114 00:06:02,040 --> 00:06:05,369 Chris Sheehan: these crooks move the money out of recipient accounts that 115 00:06:05,400 --> 00:06:06,780 Chris Sheehan: will ever get your money back for you. 116 00:06:07,710 --> 00:06:09,839 Sean Aylmer: So don't panic in a sense is kind of a 117 00:06:09,839 --> 00:06:11,010 Sean Aylmer: first point of call. 118 00:06:11,220 --> 00:06:14,130 Chris Sheehan: Yeah, spot on. Don't panic. Like literally stop and wait. 119 00:06:14,130 --> 00:06:16,830 Chris Sheehan: Nothing bad will happen if your money is in your 120 00:06:16,830 --> 00:06:17,490 Chris Sheehan: bank account. 121 00:06:18,270 --> 00:06:20,219 Sean Aylmer: Stay with me, Chris, we'll be back in a minute. 122 00:06:26,520 --> 00:06:30,390 Sean Aylmer: My guest this morning is Chris Sheehan, Executive Group Investigations 123 00:06:30,390 --> 00:06:33,930 Sean Aylmer: and Fraud at National Australia Bank. So who are running 124 00:06:33,930 --> 00:06:36,570 Sean Aylmer: the scams? Are they all overseas operators? 125 00:06:37,470 --> 00:06:43,050 Chris Sheehan: Look, no. There's certainly still in Australia, individual con men 126 00:06:43,050 --> 00:06:47,490 Chris Sheehan: and con women running their various schemes and even smaller groups. 127 00:06:47,820 --> 00:06:51,990 Chris Sheehan: But the industrialisation of scams as we see it happening 128 00:06:52,440 --> 00:06:55,890 Chris Sheehan: in Australia and other western countries now, it's all been 129 00:06:55,890 --> 00:07:00,810 Chris Sheehan: run by sophisticated, transnational, organised crime groups based all over 130 00:07:00,810 --> 00:07:03,660 Chris Sheehan: the world. But we see concentrations of them in parts 131 00:07:03,660 --> 00:07:07,710 Chris Sheehan: of Asia, Eastern Europe, and the subcontinent. Now, when I 132 00:07:07,710 --> 00:07:10,980 Chris Sheehan: say we see concentrations, that's where we see, for example, 133 00:07:10,980 --> 00:07:13,410 Chris Sheehan: the large, and people would've seen some of these on 134 00:07:13,410 --> 00:07:15,990 Chris Sheehan: YouTube videos and other things like the large call centers 135 00:07:15,990 --> 00:07:18,179 Chris Sheehan: with people operating off computers like you would in any 136 00:07:18,180 --> 00:07:21,120 Chris Sheehan: call center and phones and all that sort of thing. 137 00:07:21,900 --> 00:07:25,440 Chris Sheehan: Those are the bread and butter and tools of these 138 00:07:25,440 --> 00:07:27,780 Chris Sheehan: organised crime groups. But no one should think that those 139 00:07:27,780 --> 00:07:30,030 Chris Sheehan: people who are doing that work are anything more than 140 00:07:30,030 --> 00:07:33,989 Chris Sheehan: pawns in the game themselves. They're easily replaceable and they're 141 00:07:33,990 --> 00:07:37,050 Chris Sheehan: absolutely expendable. The big fish, I suppose, at the top 142 00:07:37,050 --> 00:07:39,960 Chris Sheehan: of the chain, these are individuals who live in all 143 00:07:39,960 --> 00:07:44,130 Chris Sheehan: different parts of the world and have created structures that 144 00:07:44,130 --> 00:07:46,590 Chris Sheehan: distance them from the people who are actually doing the 145 00:07:46,590 --> 00:07:46,861 Chris Sheehan: dirty work. 146 00:07:46,861 --> 00:07:52,200 Sean Aylmer: Okay. So as individuals, we all have responsibilities to do 147 00:07:52,200 --> 00:07:55,890 Sean Aylmer: all we can to not get scammed. What about as 148 00:07:55,890 --> 00:07:58,950 Sean Aylmer: a bank, as a telco, as a big tech platform 149 00:07:58,950 --> 00:08:04,380 Sean Aylmer: provider, what responsibility does big business have to prevent this? 150 00:08:05,040 --> 00:08:08,490 Chris Sheehan: In my view a lot. And I like the way that you phrased the question 151 00:08:08,490 --> 00:08:12,600 Chris Sheehan: because often when I talk to people about this issue, it's, 152 00:08:12,750 --> 00:08:15,300 Chris Sheehan: it really is what are the banks doing and why 153 00:08:15,300 --> 00:08:18,570 Chris Sheehan: don't the banks just take full accountability for this? And 154 00:08:19,140 --> 00:08:21,420 Chris Sheehan: I guess the first thing I'd say is banks absolutely 155 00:08:21,420 --> 00:08:23,610 Chris Sheehan: have a responsibility, and I'll talk about some of those 156 00:08:23,610 --> 00:08:26,130 Chris Sheehan: things in a moment that we need to do, and 157 00:08:26,130 --> 00:08:27,540 Chris Sheehan: I'll even talk about some of the things we could 158 00:08:27,540 --> 00:08:31,020 Chris Sheehan: do better. But it is a broader ecosystem than just 159 00:08:31,020 --> 00:08:35,160 Chris Sheehan: the banks. And to your point, telecommunications companies, online platforms, 160 00:08:35,160 --> 00:08:40,020 Chris Sheehan: messaging platforms, social media, government and, being frank, consumers all 161 00:08:40,020 --> 00:08:42,809 Chris Sheehan: have a role to play here in a Team Australia 162 00:08:42,809 --> 00:08:45,900 Chris Sheehan: approach to this issue. What can banks do better? Look, 163 00:08:46,110 --> 00:08:49,170 Chris Sheehan: there's definitely things we need to do around our monitoring 164 00:08:49,170 --> 00:08:53,610 Chris Sheehan: of payments and our ability to identify payments that look 165 00:08:53,700 --> 00:08:57,540 Chris Sheehan: risky and look as if they could be the product 166 00:08:57,540 --> 00:09:00,300 Chris Sheehan: of a fraud or a scam. And I think banks 167 00:09:00,300 --> 00:09:03,720 Chris Sheehan: globally and particularly in Western countries like ours, have embraced 168 00:09:03,720 --> 00:09:06,449 Chris Sheehan: the digital environment and digital technology for a whole range 169 00:09:06,450 --> 00:09:10,860 Chris Sheehan: of reasons, predominantly driven by consumer appetite for wanting that technology. 170 00:09:11,490 --> 00:09:15,300 Chris Sheehan: And we've probably, we facilitated the rapid movement of funds 171 00:09:15,300 --> 00:09:18,179 Chris Sheehan: via the payment systems. What we need to do now 172 00:09:18,179 --> 00:09:20,940 Chris Sheehan: is recognise that the environment has changed and we need 173 00:09:20,940 --> 00:09:25,470 Chris Sheehan: to implement increasing amounts of appropriate friction in those payment channels. 174 00:09:25,470 --> 00:09:28,170 Chris Sheehan: So the payments may not go as quickly as customers 175 00:09:28,170 --> 00:09:31,440 Chris Sheehan: are accustomed to. At NAB we've done some work on that recently. 176 00:09:31,440 --> 00:09:34,500 Chris Sheehan: We announced the implementation of payment prompts on our internet 177 00:09:34,500 --> 00:09:38,940 Chris Sheehan: banking and mobile banking payment channels. What that does is when 178 00:09:38,940 --> 00:09:42,120 Chris Sheehan: we see a payment occurring in internet banking or mobile banking, 179 00:09:42,360 --> 00:09:45,300 Chris Sheehan: if it looks suspicious, it will trigger a prompt to 180 00:09:45,300 --> 00:09:47,970 Chris Sheehan: the customer in the moment that they're making the payment 181 00:09:48,600 --> 00:09:50,429 Chris Sheehan: that will tell the customer why we think the payment 182 00:09:50,429 --> 00:09:54,540 Chris Sheehan: looks concerning to us and requires the customer to read 183 00:09:54,540 --> 00:09:57,000 Chris Sheehan: through what they're being told and acknowledge it before they 184 00:09:57,000 --> 00:10:01,470 Chris Sheehan: can proceed with the payment. So that's sort of process, 185 00:10:01,470 --> 00:10:03,479 Chris Sheehan: I guess I'm talking about in terms of introducing a 186 00:10:03,480 --> 00:10:06,209 Chris Sheehan: bit more friction to slow things down to a level 187 00:10:06,210 --> 00:10:09,210 Chris Sheehan: that it's still convenient, but we want to make it safer. 188 00:10:09,990 --> 00:10:11,640 Sean Aylmer: We're almost out of time, but I've got to ask 189 00:10:11,640 --> 00:10:15,089 Sean Aylmer: you, the research by you guys by National Australia Bank 190 00:10:15,270 --> 00:10:18,450 Sean Aylmer: shows that young people aged 18 to 29 are least concerned 191 00:10:18,450 --> 00:10:21,599 Sean Aylmer: but most likely to lose out to a scam. Is 192 00:10:21,600 --> 00:10:25,140 Sean Aylmer: that the exuberance of youth perhaps, or maybe they use 193 00:10:25,470 --> 00:10:28,589 Sean Aylmer: digital platforms more than anyone else therefore are more likely 194 00:10:28,590 --> 00:10:31,770 Sean Aylmer: to be scammed. What's behind that? That really surprised me. 195 00:10:32,010 --> 00:10:34,500 Chris Sheehan: So I think both of those points that you made 196 00:10:34,500 --> 00:10:38,370 Chris Sheehan: are correct. I also think that a function of that 197 00:10:38,370 --> 00:10:41,100 Chris Sheehan: is that we're talking about a generation that has grown 198 00:10:41,100 --> 00:10:47,550 Chris Sheehan: up with mobile phones, smartphones, iPads, laptops, doing everything online, 199 00:10:47,700 --> 00:10:51,300 Chris Sheehan: conducting all their relationships online. And so there's a degree 200 00:10:51,300 --> 00:10:55,350 Chris Sheehan: of confidence that comes with having, I guess, that technology 201 00:10:55,350 --> 00:10:59,880 Chris Sheehan: in your DNA if you're in that age group, I am not. And I 202 00:10:59,880 --> 00:11:04,770 Chris Sheehan: think with that degree of confidence comes complacency, and I 203 00:11:04,770 --> 00:11:07,380 Chris Sheehan: think that's being exploited by these criminal groups, is that 204 00:11:07,800 --> 00:11:11,970 Chris Sheehan: complacency and the trust that age group has in the technology. 205 00:11:12,300 --> 00:11:14,610 Sean Aylmer: Incredible. Chris, thank you for talking to Fear and Greed. 206 00:11:15,420 --> 00:11:15,929 Chris Sheehan: Thank you. 207 00:11:16,830 --> 00:11:20,429 Sean Aylmer: That was Chris Sheehan, Executive, Group Investigations and Fraud at 208 00:11:20,429 --> 00:11:23,309 Sean Aylmer: National Australia Bank. This is the Fearing Greed Daily Interview. 209 00:11:23,309 --> 00:11:25,859 Sean Aylmer: Join us every morning for a full episode of Fear 210 00:11:25,860 --> 00:11:29,010 Sean Aylmer: and Greed, Australia's most popular business podcast. I'm Sean Aylmer. 211 00:11:29,250 --> 00:11:29,969 Sean Aylmer: Enjoy your day.