Scam artists operating at speed banks and consumers cannot match, conference told

Banking and Payments Federation of Ireland forum hears better education and responses needed to protect consumers

Scam artists are becoming increasingly advanced and operating at speeds consumers and banks struggle to match, a banking conference has been told.

The Banking and Payments Federation of Ireland National Payments Conference heard that consumers needed more education while greater collaboration between telecoms companies, the Government and banks was essential if criminals were to be stopped.

“Everybody is vulnerable because the criminals have got so good at reeling people in,” said AIB’s head of financial crime, Carol Lawton. She noted that scam artists have broadened the scope of their attacks to include bogus messages from health providers, delivery companies and toll operators and she warned that many attacks are multipronged.

Niamh Davenport from the BPFI’s FraudSmart unit noted that often a bank only becomes aware something is amiss when an attempted payment is made – by which time a scam can be well-advanced.

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She said plans for a shared fraud database to give banks greater and earlier insight into the activities of criminals were set to come in effect later this year, giving banks the capacity to share details of suspicious activity.

Ms Lawton told the conference that tracking scam artists was “not like looking for a needle in a haystack, it’s like looking for a needle in a box of needles”.

She said there were “relatively few transactions” that created immediate red flags with banks and suggested that a broader data set was needed, including engagement with mobile phone operators.

She also noted the growing prevalence of young people allowing their accounts to be used by criminals. “They don’t see the consequences for themselves and they don’t see the consequences for other people so we need a national education programme.”

The conference also heard from Mairead McGuinness, the European Commissioner for Financial Services, who noted that technology had seen the payments landscape disrupted with new entrants to the market “offering more choices in payments than ever before”.

She said customer preferences were also changing and “ecommerce has accelerated the shift towards digital payments”.

“But lots of us still want to be able to pay with cash,” she added.

She said a decline in the number of bank branches and ATMs was a problem, because “the demand for cash hasn’t gone away” and while there were “lots of positives with the digital revolution – it also risks leaving some people behind”.

She also highlighted work being done to advance instant payments and the digital euro. “We want instant payments to become universal” with operators who offer transfers in euro required to “offer an instant option [and] instant payments will be a standard and affordable feature, not a premium service”.

She stressed the need for a digital euro to cover the whole of the euro zone and warned that without it “innovative EU businesses may need to rely on private stablecoins or foreign central bank digital currencies. And this exposes them to risks around market stability, currency conversion, even losing control over their data.”

She added that a digital euro would coexist with private payment solutions with “public and private money both playing their role in our financial system”.

Conor Pope

Conor Pope

Conor Pope is Consumer Affairs Correspondent, Pricewatch Editor