Government to protect Aussies with ‘ironclad’ scam laws

On Thursday last week, Financial Services Minister Stephen Jones revealed the government had legislated anti-scam laws to reinforce the cyber security of all Australians, specifically the elderly.

The government noted the legislation was supposedly the “world’s toughest” anti-scam laws and established the Scams Prevention Framework, focused on stopping scams from reaching the country.

Minister Jones said the framework required designated entities to prevent, detect, disrupt, respond and report scams and attempted scams.

“Our laws give Australia the strongest defences against scammers and put us ahead of the world in scam prevention and protection,” he said.

“This is a promise we made ahead of the 2022 election and will make a genuine difference in the lives of everyday Australians. These new laws will keep Australia one step ahead of criminal scammers.”

The government noted it planned to initially designate banks, telcos and social media companies under the framework as these businesses would be subject to comprehensive and enforceable sector-specific rules for what they should do to protect Australians.

The rules may require social media companies to verify advertisers on their platforms, banks to confirm the identity of payees and telecom companies may be required to detect and disrupt scam numbers.

Minister Jones added that businesses would have substantial incentive to have “ironclad” scam defences as fines of up to $50 million could be applied to those who failed to meet obligations.

“Victims will have clear pathways to compensation if the business fails to meet robust standards. Australians should never have to fight criminal scammers on their own,” he said.

“This is landmark legislation that will set Australia up for a stronger and safer future where people’s money is safer online.”

Under the legislation, the Australian Competition and Consumer Commission (ACCC) would closely monitor regulated entities’ compliance with principles to prevent, detect, disrupt, respond to and report scams.

The Scams Prevention Framework would empower the ACCC to investigate potential breaches and take enforcement action where entities do not take reasonable steps to fulfil their obligations under the principles.

The newly passed legislation was welcomed by the Council on the Ageing (COTA) Australia, which noted the laws were an important step towards ensuring elderly Australians were given greater protection against scams.

According to COTA, in 2024 older Australians lost approximately $99.6 million to scams, highlighting the need for urgent action.

CEO of COTA, Patricia Sparrow, said older Australians were falling victim to scam activity at an alarming rate, with over 62,000 reported incidents last year.

“These sophisticated scams are having a devastating impact on retirement savings,” Sparrow said.

“This framework will ensure banks, telecommunications companies and social media platforms are held accountable for preventing scams and properly compensating victims when prevention fails, which is crucial.”

Sparrow said it was important to take the Senate inquiry’s concerns into account regarding the potential complexity around compensation.

“There’s a clear need to ensure subordinate legislation, industry codes and the external complaint resolution process is established in a way that ensures compensation will, in practice, be achievable under the scheme.

“With thousands of older Australians losing their savings each year, we need a system that delivers genuine accountability and accessible compensation pathways.”