Government Takes Action to Combat Scams
In a move to protect Australians from falling victim to scams, the Assistant Treasurer and Minister for Communications have announced the release of the exposure draft of the Scams Prevention Framework legislation. This legislation aims to establish scam prevention principles that will guide industry-specific, mandatory obligations on designated sectors.
Assistant Treasurer and Minister for Financial Services, Stephen Jones, highlighted the importance of addressing the issue of scams in Australia. He stated, “Australians are losing too much money to scams, and while we’ve bucked the international trend where scams are doubling every year, losses are still far too much.” The government is taking a proactive approach to combat scams by implementing strong obligations on key businesses within the scam ecosystem.
Key Provisions of the Scams Prevention Framework Legislation
The new legislation establishes a new part in the Competition and Consumer Act 2010, enabling the Australian Competition and Consumer Commission (ACCC) to enforce the law against businesses in designated sectors that fail to meet their obligations. Penalties of up to AUD50 million can be imposed for non-compliance under the Act.
Once the legislation passes Parliament, the framework will enable the minister to designate sectors and establish sector-specific codes that impose mandatory obligations on designated sectors to combat scammers and protect Australians. Initially, banks, telecommunication service providers, and a range of digital platform services related to social media, paid search engine advertising, and direct messaging services will be designated.
The legislation will mandate designated sectors to have internal dispute resolution mechanisms that are accessible and transparent for customers. An external dispute resolution (EDR) scheme will be nominated for all scam complaints made under the framework. This will ensure that victims have a clear pathway for redress when the entity has done the wrong thing.
Government Funding to Combat Scam Activity
The government has allocated over AUD154 million in the 2024-25 and 2023-24 Budgets to tackle scam activity across the economy. Minister for Communications, Michelle Rowland, emphasized the government’s commitment to cracking down on criminals trying to rip off hardworking Australians. She stated, “The Scams Prevention Framework builds on the package of reforms the Albanese Government is already delivering to protect Australians from scams.”
The government’s efforts to protect Australians from scams also include the establishment of the Sender ID Register, aimed at blocking fake SMS messages that dupe Australians. These initiatives are part of a comprehensive approach to safeguarding Australians from falling victim to fraudulent schemes.
Feedback and Consultation Process
Interested parties are encouraged to provide feedback on the exposure draft legislation and explanatory materials, which can be found on the Treasury website. Submissions will remain open until October 4, 2024. The feedback received from stakeholders will shape the development of the final bill for introduction to Parliament later this year.
The government is committed to working collaboratively with industry stakeholders, consumer advocates, and the public to strengthen the Scams Prevention Framework legislation. By engaging in an open and transparent consultation process, the government aims to ensure that the final legislation effectively addresses the issue of scams and protects Australians from falling victim to fraudulent activities.