Australian banks have introduced a digital platform called the Fraud Reporting Exchange (FRX) in an effort to crack down on authorized push payment scams. The platform enables the reporting of fraudulent payments in near real-time, increasing the chances of freezing and returning funds to affected customers, thus disrupting fraudsters and scammers.
Australian Banking Association (ABA) CEO Anna Bligh emphasizes the significance of the FRX's launch, stating, "Given the time sensitivity in combating scams, the introduction of the FRX is a major advancement. It means scammers will encounter more obstacles and enhances the range of anti-scam initiatives already underway."
The FRX platform is owned and operated by the bank-supported Australian Financial Crimes Exchange (AFCX). Currently, 17 banks have either joined or are in the process of joining the platform.
Upon its launch, the FRX will empower banks to halt multiple fraudulent transactions associated with the same scam, exchange intelligence to enhance loss-prevention efforts, and facilitate the swift return of funds when feasible.
Early trials of the FRX platform have demonstrated a reduction of over 50% in the time taken to resolve most scam cases.
Bligh stresses the importance of consumers promptly reporting any fraudulent or scam payments to their respective banks, as early detection enables banks to take immediate action to halt payments before they reach scammers.
Consumer groups welcome the introduction of the FRX platform but assert that banks should be more proactive in preventing scams from reaching consumers and providing reimbursement to victims of authorized push payment fraud. Stephanie Tonkin, CEO of the Consumer Action Law Centre, suggests that mandatory laws imposing financial incentives on banks may be necessary to drive significant change, citing a recent ASIC report that revealed major banks reimbursed only 2-5% of scam losses last year.