Government Responds to Surging Scam Threat
The Government has launched an Anti-Scam Alliance to combat online financial scams. MBIE reports that over 60% of New Zealanders encounter online financial scams monthly.
Commerce and Consumer Affairs Minister Scott Simpson says scams cost the economy up to $2 billion annually. “It is unacceptable that so many Kiwis are swindled by scammers every day.”
He said that, up until now, New Zealand’s anti-scam efforts have developed in an ad hoc manner and suffered from a lack of coordination. He pointed to the current system’s fragmented response as a key barrier.
“We frequently hear that real-time information on scams is sourced from different areas across government and the private sector, making for a fragmented and often slow response.”
Alliance to Boost Coordination and Consumer Protections
The alliance unites government agencies, banks, telecommunications companies, digital platforms sectors, and consumer groups with a structure to share data.
Beyond sharing information, the group will take tangible steps to improve protections.
“The Alliance has also agreed to take coordinated action to update industry codes, strengthen consumer protections and educate Kiwis about how to protect themselves from scams.
The Government is also exploring other initiatives, such as amendments to the Fair Trading Act, which would enable government and industry to share scam-related intelligence proactively and collaborate on disruption initiatives without breaching competition or privacy laws.
“There is no silver bullet to address scams, but by working together across sectors to disrupt scams, we can significantly shift the dial.”
FMA and ASB Back Collaborative Action
The move has been welcomed by regulators.
The Financial Markets Authority (FMA) – Te Mana Tatai Hokohoko welcomed the Alliance. “Collaboration is a vital factor in the fight against scams. We look forward to playing our part in the Alliance,” FMA Executive Director, Licensing and Conduct Supervision Clare Bolingford, said.
To maintain confidence in the national financial markets sector, disrupting scam activity is one of the FMA’s priorities. The FMA consider the Alliance “a significant move forward in a coordinated New Zealand response to scams.
“We want investors and consumers to make good decisions, know their rights and know how to protect themselves.”
ASB chief executive Vittoria Shortt agrees. “Banks and telcos have been working very hard, both individually and together, for some time, to tackle fraud and scams. We’ve partnered with others in the industry, like consumer groups and police, but the real power comes in a true all-of-ecosystem approach.”
ASB spent around $140 million fighting fraud, scams, and financial and cyber crimes this financial year.
“We know there is still more to be done, but today’s announcement is another step forward and we will continue to build on the work we’re already doing in this space,” says Shortt.
Banks Roll Out New Fraud Prevention Tools
The banking sector has long called for broader coordination.
“We’ve been calling for a coordinated multi-sector approach to scam prevention and consumer protection since 2023,” New Zealand Banking Association chief executive Roger Beaumont said.
“Scams typically start when people are deceived by fake websites and search engine results, fake emails, texts, social media ads and chats, and phone calls, so there’s a role for telcos, social media companies, and global tech platforms to help stop them in the first place.
“In April this year, we finished rolling out a Confirmation of Payee service across 13 retail banks to help customers check that the name of the person they are paying matches the account number. This can stop mistaken payments and avoid payments to scammers.
“We have also recently announced a suite of other scam prevention measures that will be included in an update to the Code of Banking Practice later this year.
“In addition to Confirmation of Payee, banks will commit to providing pre-transaction warnings for certain payments, identifying high-risk transactions, providing a 24/7 scam reporting channel, and sharing with other banks information about accounts used by criminals.
The measures aim to make scam prevention faster, clearer and more responsive. And if protections fall short, banks will face new obligations.
“Where banks fail to meet those commitments, they will compensate all or part of the loss for eligible customers.”
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