Banking scams: Concerns intrude on Govt’s big bank probe announcement

The spectre of scams was raised at Parliament today as the Government announced an inquiry into the banking sector.

Ministers announcing the Commerce Commission market study were asked about the responsibilities banks had to scam victims.

Finance Minister Grant Robertson said it would be for the Commerce Commission to decide if scams or lack of reimbursement to scam victims were factors in bank profitability.

“They are serious issues,” he said. “We’d strongly encourage banks to be working with their customers on how to avoid scams.”

But investigations into scamming were not generally expected to be part of the Commerce Commission inquiry.

Commerce and Consumer Affairs Minister Duncan Webb said there was plenty of work to do in the field of financial literacy.

“In terms of scams, it’s really important to recognise that banks need to do what they can to prevent scams. But it is in partnership with customers.”

He urged people to avoid clicking on unsolicited links or falling into other traps scammers commonly deployed.

Webb said the Retirement Commissioner was already working on financial literacy, which included trying to protect people against scams.

This year, a variety of banking and finance scams have targeted people, who in some cases have lost thousands of dollars - and in one case, $400,000.

In an environment of high interest rates, some “imposter” scammers masquerading as banks have targeted people looking for popular term deposits.

The co-founder of Kiwi start-up Akahu has argued New Zealand was behind other countries with open banking, which allowed third-party services to access bank data, with potential security and verification consequences.

The Government today said it wanted the Commerce Commission to focus on personal banking services, including those ordinarily acquired for personal, domestic or household use.

The banking sector inquiry press conference can be viewed on the Herald’s YouTube page here.

John Weekes is online business editor. He has covered politics, crime, courts and consumer affairs. He rejoined the Herald in 2020, previously working at Stuff and News Regional, Australia.