New Zealand customers are losing almost 15 per cent more to scammers than they did last year.
Provisional data from the country’s banks suggests customers are on track to lose about $70 million in fraud-related scams this year, says Banking Ombudsman Nicola Sladden.
Nicola says $70 million is almost certainly just the tip of the iceberg.
“The true scale of the losses may never be known.
“Some industry commentators estimate $500 million is probably a more accurate figure.
A lot of scams go unreported, either because the amount is quite small, or embarrassingly large, or people feel there is nothing the banks or authorities can do to help them, says Nicole.
“Banks are required to keep their banking systems secure."
Bank systems can detect some unusual spending patterns and prevent attempts by fraudsters to access accounts.
"However, once a customer authorises a payment to a fraudster, it is usually gone."
NetSafe is reporting scam losses that are almost five times higher than last year and that’s just from the scams that have been reported.
NetSafe data shows that between January and September 2018 almost 8000 New Zealanders reported a scam to the organisation, with more than $24.7 million lost to scammers.
The Financial Intelligence Unit within the New Zealand Police estimate $27 million in scam losses over the last 18 months.
Though this figure also doesn’t represent the true total, or all of the remitting agencies in New Zealand, as these scams are grossly unreported.
One recent such case involved 78-year-old Palmerston North woman Margaret Taylor.
She got a call from a man, claiming to be from telecom company Slingshot, who said someone in Wellington was using her internet connection to download pornography.
Margaret asked him some questions, and he gave convincing answers.
He then pressured her to quickly cut off the so-called “intruder”.
She agreed and began to divulge confidential information.
It was only the arrival home of her tech-savvy flatmate Leanne Warr, who realised the man was hacking into her bank accounts, that saved the day.
Margaret is not alone. Nicola says the scam cases reported to the Banking Ombudsman have gone up 73 per cent since last year (Jan-Sept).
“More and more of the cases we’re seeing are absolutely devastating for the individuals concerned.
"Once it was rare to see someone lose $100,000, but not anymore.
“No one can afford to let down their guard for a moment – especially not older customers who are more often victims because of their lack of awareness about the internet, current scams and what to do when they get suspicious emails, calls and offers.”
The growing size of the problem has prompted the Banking Ombudsman Scheme to commission television and radio commercials highlighting simple steps to beat scammers at their own game.
The campaign will be launched during Fraud Awareness Week, from 11-17 November.
The Banking Ombudsman, Netsafe and the NZ Police are all supporting Fraud Awareness Week (11-17 November) which is led by the Consumer Protection team within the Ministry of Business, Innovation and Employment.
A wide range of public and private sector organisations are supporting it this year.
“New Zealanders are losing too much money to scams each year,” says Detective Superintendent Iain Chapman, National Manager of the Police Financial Crime Group.
“By far the best chance we have of getting your money back is by helping you not to lose it in the first place.
“The reality is that despite the combined efforts of all agencies involved in financial crime in New Zealand, there are significant challenges identifying and prosecuting overseas offenders involved in online scams."
This is further made worse by the fact that international funds transfers can take a matter of minutes.
“If you have family members who are not technologically savvy, now is the time to talk to them about staying safe online.
“This year for Fraud Awareness Week Kiwis are being urged to Stop & Think: is this for real?” says Mark Hollingsworth, Manager Consumer Protection (MBIE).
“In the same way that we all know to ‘drop, cover, hold’, we want people to automatically question unexpected calls and emails.
“The message is simple, if you get any online contact from anyone you don’t know, or asked for personal or financial information from anyone, including banks and government departments – be suspicious before doing anything else - stop and think."
Always question uninvited approaches in case it is a scam.
"Instead, contact the company directly using a known email or phone number," says Nicola.
The key message for Fraud Awareness Week is Stop & Think: is this for real?
• A genuine bank or organisation will never contact you to ask for your PIN, password or to move money to another account.
• Never click on a link in an unexpected email or text – you could be giving access to your personal and financial details.
• Always question uninvited approaches in case it is a scam.
Instead, contact the company directly using a known email or phone number.
• Don’t assume an email or phone call is authentic – just because someone knows your basic details (name and address, or mother’s maiden name) it doesn’t mean they are genuine.
• Don’t be rushed into making a decision or financial transaction on the spot – a genuine bank or trusted organisation would never do this.
• Listen to your instincts – if something feels wrong then it generally is.
Visit the scamwatch page for more information on how you can prevent yourself, family and friends from being scammed.