Opinion
Carol ‘completely trusted these people’, then her life savings disappeared
Nina Hendy
Business and finance journalistThe emotional turmoil scam victims go through can be devastating.
Many dedicate weeks or even months to trying to have their money returned to them, telling anyone who will listen that they didn’t mean to hand over their hard-earned cash to a scammer.
NSW pensioner Carol Scaramuzzi says scammers emptied her bank account of $19,800.Credit: Tribune
But the banks that are meant to protect our money often turn their backs on scam victims in their time of need.
Many agree that banks aren’t doing enough to protect their customers from scams. While two-factor authentication is an important step in the right direction, banks don’t reimburse scammed money, by claiming financial crime victims “authorised” the transaction.
NSW pensioner Carol Scaramuzzi says her bank spent a few weeks trying to recover her life savings that disappeared out of her bank account without her authorisation, before closing the case and saying nothing more could be done.
The 78-year-old explains that when her computer crashed, she looked up a phone number for Apple technical support online and called in the hope they could help.
She spoke to what she thought was the Apple technical support team. They told her they were intercepting scammers attempting to empty her bank account.
Exhausted and terrified that she would lose all her savings, she stayed on the call for hours. The next morning, Scaramuzzi discovered her bank account had been emptied. They took her life savings: $19,800, leaving $300 in her account.
“I completely trusted these people. They seemed very understanding, and made me feel as though they were really trying to track down the hackers who were intercepting my account, I thought trying to stop this fraudulent activity,” Scaramuzzi says.
Devastated, she sprang into action, contacting her bank, ING. She also reported the matter to police and filled out a statutory declaration.
The funds were traced to a Westpac bank account. She tried asking Westpac to return the funds, which the bank’s fraud team had frozen after suspecting suspicious activity. But they couldn’t get a response from the account holder, so said they couldn’t just return it to her.
Scaramuzzi, who has breast cancer, believes ING has a moral obligation to reimburse the money because her account had a $5000 daily withdrawal limit. But the scammers were able to intercept her account and increase the withdrawal limit to $20,000.
“Clearly the scammers made an application to alter this to gain access to my account, and at no time did ING contact me with an email or message to confirm I had made this request,” Scaramuzzi says.
After investigating, ING closed the matter and told Scaramuzzi the money could not be recovered. Not giving up, the pensioner raised a complaint with the bank. Her niece, who lives on the other side of the world, also contacted the media in the hope that making some noise would force the bank’s hand.
It worked. Three hours after this masthead contacted ING about this case, Scaramuzzi’s money was returned to her in full.
When asked how it was possible that suddenly, the money could be returned although Scaramuzzi’s case had been closed, an ING spokesperson said the bank was fully committed to combating scams, and had been educating customers about scams, through its website and on social media.
The Albanese government is cracking down on scams, and has established an anti-scam centre as it starts working with banks to ensure they have the measures in place to prevent, disrupt, respond to and report scams.
The threat of penalties for non-compliance and victim compensation where wrongdoing occurs could help thousands of future scam victims. But it is unlikely victims who have lost money in the past will ever see their money again.
Anthony Albanese’s government is cracking down on scams.Credit: Alex Ellinghausen
Last week, the Australian Securities and Investments Commission (ASIC) found in a damning new report that the anti-scam prevention strategy deployed by ING and 14 other banks doesn’t provide enough support for fraud victims.
The report found the banks don’t have a specific strategy for dealing with scams and don’t give their staff adequate training to support customers reporting scams.
Thousands of Australians lost a collective $2.74 billion to scams in 2023. While overall losses decreased by 3 per cent, the total number of scams reported by Australians increased by 18.5 per cent, highlighting the increasing adaptability and sophistication of techniques used by scammers.
ASIC’s latest report reveals that the 15 banks offer poor customer service, slow response times, mishandle reports of scams, send out confusing communications and fail to identify vulnerable customers affected by scams.
Making customers navigate several bank teams to handle their case when they have been scammed also isn’t fair.
“Like the four major banks we reported on last year, the 15 banks in this latest report also demonstrated a less mature approach to scams strategy and governance than we expected,” ASIC deputy chair Sarah Court says.
While recent indicators suggest overall scam losses have been decreasing despite a growing number of reports from bank customers about scam reports, ASIC wants to see improvements. “We expect all banks regardless of their size, to pull their weight in the fight against scams,” Court says.
For scam victims like Carol Scaramuzzi, it’s only the threat of public embarrassment that ultimately forces a bank to do the right thing by their customers. So much for banks keeping our money safe.
- Advice given in this article is general in nature and is not intended to influence readers’ decisions about investing or financial products. They should always seek their own professional advice that takes into account their own personal circumstances before making any financial decisions.
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