Happiness: The Fight Back
A Group of Victims Takes a Stand Against Scams in New Zealand
As New Zealanders continue to grapple with the issue of scams, one group of victims has turned their traumatic experiences into a force for change. In late 2022 and early 2023, victims of the Citibank scam began to come forward, revealing the shocking scale of the disaster.
The Power of Shared Experiences
Real estate agent Carla O’Neil lost $100,000 in February last year, but after going public in May, she was inundated with heartbreaking messages from dozens of other victims who had been through similar ordeals. These brave individuals have banded together to advocate for recognition and better consumer protections from the country’s banks.
Identifying Deficiencies in New Zealand’s Banking System
The group has discovered glaring deficiencies in New Zealand’s banking system, including:
- A lack of technology allowing customers to verify details about the account receiving their money – known as “confirmation of payee” – which is already in place overseas.
- Glaring failures in monitoring and reporting mule bank accounts used for laundering illicit funds.
Calls for Change from Government and Consumer Advocates
Consumer Affairs Minister Andrew Bayly has put the banking sector on notice, warning them to move voluntarily or face government regulation. He stated, “Nearly $200 million was lost to scams last year. This needs to change.”
The Banking Ombudsman has repeatedly called for better customer protections and a review of fraud reimbursement rules.
Consumer NZ chief executive Jon Duffy has accused the banking sector of failing its customers and called for the Code of Banking Practice to be redrafted so it is fit for purpose and offers proper consumer protections. He says that until confirmation of payee is introduced, banks should refund scam victims whose losses could have been avoided had the technology already been in force.
Banks Take Action
Under mounting pressure, the Banking Association has announced it is reviewing fraud reimbursement rules and introducing confirmation of payee later this year. Banks have also introduced other anti-fraud measures, such as:
- Removing links in text messages to customers
- Cracking down on mule accounts
Next Steps: A Possible Class Action
The victim group is now in talks with lawyers over a possible class action to hold banks to account. Their stories are deeply troubling, but they hope their shared experiences will force real change and prevent others from losing everything they’ve worked for.
As the fight back against scams continues, one thing is clear: it’s time for banks to take responsibility for protecting their customers from these devastating crimes.