***Scams Prevention Framework raises the bar for digital trust***
Passed by Parliament earlier in February, the newly minted Scams Prevention Framework (SPF) represents a crucial evolution in our collective fight against scams. It goes some way to updating Australia’s legislation in line with modern needs.
The SPF’s focus is on “reasonable steps” to prevent scams. This puts even more emphasis on robust identity verification and fraud prevention measures during onboarding. Where these steps were simply industry best practice, they are now essential for building trust and mitigating risk. Read more below.
Are you ready for the new scam laws?
Scams Prevention Framework
The Scams Prevention Framework was passed by Parliament early in February. It’s a long-awaited and much-needed step towards aligning Australia’s legislation with the needs of modern scam prevention.
Information released by Parliament calls the framework “a multifaceted approach for protecting Australian consumers from scams”. It does so by putting the onus on organisations in the banking, telecommunications and digital platforms industry to take action against scams.
These new requirements mean affected entities need to take proactive measures – and technology may be the only way to balance the stringent requirements while protecting user experience.
Governance, prevention, response
The Framework is built on two principles that relevant organisations must comply with:
- Governance of arrangements relating to scams – documenting and implementing governance policies, procedures, metrics and targets, which must be reviewed at least annually by a senior officer
- Preventing, detecting, reporting, disrupting and responding to scams – entities need to act quickly to look into suspicious activity, do what they can to disrupt it, minimise any loss, and identify consumers who might have been affected by a scam. Each entity may also be required to comply with additional sector-specific requirements. For those affected by the new legislation, taking every step to detect, prevent and disrupt is paramount – the costs of managing the fallout from a successful and unchecked scam can be astronomical. Compared to this outlay, it makes sense to invest in excellent technology that helps prevent and minimise the impact of scams.
Penalties attached
These new expectations of relevant organisations are not without consequence. Regulated entities will be monitored and investigated by the ACCC. Those failing to meet requirements may face civil penalties.
The framework sets out maximum penalties under Subdivision C, which include hefty penalty points, fines, the possibility of damages, injunctions, remedial directions and more.
It notes that these penalties may apply to an individual, such as a “senior officer of the regulated entity.”
Practical solutions – LAB
These new requirements have placed affected entities on notice – governance, detection, prevention and reporting must be baked into day-to-day processes, particularly onboarding.
However, without innovative, purpose-built technology, user experience can be sacrificed.
LAB Group has been building its capability to ensure individual and payment details are more stringently verified in key points of the customer lifecycle. Configurable user permissions make it easy to integrate with your workflow, while seamless integration with the LAB Portal gives you access to one-touch reporting when needed.
To see how LAB Group can ensure your organisation is ready for new Framework rules, request a demo now.
