Financial scam complaints surged to record-high levels in 2023.
The Australian Financial Complaints Authority (AFCA) received more than 100,000 complaints in 2023 — almost doubling its 2022 total.
Consumer groups have urged financial services like banks and insurers to do more to protect their customers against fraud.
Here’s what you need to know.
What’s AFCA?
AFCA was established in 2018 after a review identified a need for more effective ways to settle complaints with financial institutions.
It handles complaints that may have already gone through official channels like the Financial Ombudsman Service and the Superannuation Complaints Tribunal.
AFCA is considered a ‘last resort’ dispute resolution scheme. It handles complaints between individuals or small businesses and services like banks, insurers, and superannuation firms.
Financial scam complaints in 2023
The most commonly received complaints in 2023 were about unauthorised transactions and delays in claims handling (e.g insurance).
The authority said complaints relating to financial hardship also increased “significantly” in 2023.
AFCA Chief Ombudsman David Locke said, “We believe many financial firms could be doing a better job of handling complaints within their own internal complaints processes”.
Scams
Complaints relating to scams increased by 95% in 2023 compared to 2022.
Data from the consumer watchdog showed Australians lost $3.1 billion to scams in 2022.
Locke said he hoped 2024 would be the year that “anti-scam initiatives by industry and government finally disrupt this serious and organised crime”.
Calls for action
Alexandra Kelly, Director of Casework at the Financial Rights Legal Centre, said the rise in scam complaints showed financial firms haven’t done enough to address scams.
“Banks, telcos and other institutions need to take responsibility for the fact that scammers are using their payment and communications systems to perpetrate fraud and stop
blaming the victim,” said Kelly.
