Banks have introduced new fraud protections as Kiwis lose millions to scammers
Banks must reimburse fraud victims up to $500,000 and introduce new scam prevention measures.
The changes include technology to identify risky transactions and the ability to freeze suspect accounts.
Compensation applies if banks fail to meet prevention commitments, with the new rules effective from November.
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Banks will be required to reimburse fraud victims up to $500,000 and introduce new rules to crack down on scammers in a suite of measures unveiled today.
The changes include new technology to identify risky or unusual transactions based on a customer’s banking history and the ability to freeze payments and suspect accounts.
The moves are in response to Government demands to improve customer protections or be regulated in the face of Kiwi victims losing hundreds of millions of dollars to scammers each year.
The Herald has been campaigning for new safeguards to protect victims, highlighting dozens of cases in which Kiwis were tricked into losing their life savings through elaborate investment scams – many involving local “money mule” accounts.
Advocates have repeatedly warned that New Zealand was lagging behind other jurisdictions in terms of consumer safeguards. Today’s announcements aim to bring us into line with the likes of the UK.
The New Zealand Banking Association says it is rolling out a package of new protections in line with international best practice, which will be in place by November.
They include:
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A confirmation of payee service for customers to check that the name of the person they are paying matches the account number. Rollout of this has already commenced.
Pre-transaction warnings to consumers based on the payment purpose, for instance, higher-risk investments.
Identification of high-risk transactions or unusual account transaction activity, and the ability to block or delay payments.
A 24/7 reporting channel for customers who think they’ve been scammed.
Sharing scammer or “mule” account information with other banks to help prevent criminal activity, and freezing funds where appropriate.
New fraud reimbursement rules would also see victims who were tricked into authorising payments to fraudsters reimbursed up to $500,000, provided they met certain criteria.
The compensation would not apply to international money transfers, third-party payment services or purchases on social media.
Compensation would only apply if a bank failed to meet the new scam prevention commitments outlined above.
A decision on whether victims were compensated would also depend on whether they had taken “reasonable care” when making payments.
In the UK, the test is a much higher bar of “gross negligence”.
Association chief executive Roger Beaumont said scam prevention was the best way to protect consumers from scam losses. The new measures were a huge step up in the fight against online fraud.
“Banks already do a lot to identify and help prevent scams, and these new measures will enhance tech solutions to help protect customers from increasingly sophisticated scams.”
The new rules and policies are being written into the Code of Banking Practice, which will go live on November 30.
This means the Banking Ombudsman will be able to hold banks to account against the new code and determine if compensation should be awarded to complainants.
‘Important win for bank customers’
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Commerce and Consumer Affairs Minister Scott Simpson said banks had responded to the Government’s expectation to better protect consumers by introducing stronger safeguards and a compensation scheme.
“New commitments from banks mean that if a bank fails to adequately warn and protect a consumer from a scam, they will reimburse the victim up to $500,000.
“This is an important win for bank customers, who have been advocating for some time for better recognition from banks of the role they play as the final gate between a consumer and a scammer.”
The Government wrote to banks last year demanding improvements to protect customers, threatening regulation if the sector did not bring in voluntary measures.
Simpson said scams caused immense harm to the economy as consumers lost confidence in transacting online.
“While people still need to remain vigilant and take responsibility for their own online safety, these changes will enable consumers to check a payment is legitimate before transferring money.
“I have been clear with banks that the journey doesn’t stop here. I expect banks to continue to prioritise security and adapt to the ever-evolving scams environment.”
‘Emotional and financial cost of scams’
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Banking Ombudsman Nicola Sladden said her office had been calling for stronger consumer protections. While the new measures were welcome, the “devil is often in the detail”.
“We see firsthand the emotional and financial cost of scams. Beyond the monetary impact, victims endure the distress of being deceived, leading to a loss of confidence to operate online.
“Consumers are doing more and more online, making it increasingly vital they have a safe digital environment in which to make payments and transfer money.”
Confirmation of payee was an obvious way to fight back against scammers, Sladden said.
Other initiatives like greater sharing of intelligence, improved fraud detection systems and warnings for high-risk transactions would also help keep Kiwis safe.
Reimbursement scheme comes with caveats
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Consumer NZ chief executive Jon Duffy has been a vocal critic of lax bank scam protections.
He said many of the measures announced today were already common overseas, which meant NZ banks had until now failed to respond adequately to increased scam activity.
The progress was welcome, but bank customers should note the new measures did not guarantee reimbursement if they were scammed, Duffy said.
“Banks will not be liable if they make reasonable efforts to alert a customer to risks. Customers will need to pay attention to warnings from their bank about risky transactions and be cautious if confirmation of payee checks return ‘no match’.
“Consumers should also note that protections do not apply to purchases made on social media or online marketplaces like Facebook Marketplace.”
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Poll: 🤖 What skills do you think give a CV the ultimate edge in a robot-filled workplace?
The Reserve Bank has shared some pretty blunt advice: there’s no such thing as a “safe” job anymore 🛟😑
Robots are stepping into repetitive roles in factories, plants and warehouses. AI is taking care of the admin tasks that once filled many mid-level office jobs.
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51.9% Human-centred experience and communication
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3% Other - I will share below!
The Gospel’s Relevance Today**
The Gospel, meaning ‘good news’, is the cornerstone of the message contained in the Bible’s first four books—Matthew, Mark, Luke, and John. While these records were written approximately 2,000 years ago, a natural question arises: why is this Gospel still relevant and vital for us today? This analysis seeks to explore what the Bible itself defines as the Gospel and to understand its enduring significance.
**Defining the Gospel: Core Biblical References**
The Gospel is not a vague concept; Scripture provides clear descriptions of its content and focus.
* **The Gospel of the Kingdom:** In Matthew 4:23, as Jesus begins his ministry, he is described as “preaching the gospel of the kingdom.” This immediately establishes that the good news is centrally about a kingdom—the Kingdom of God. His accompanying miracles served to validate the authority of this message.
* **The Gospel of Jesus Christ:** Mark 1:1 opens with, “The beginning of the gospel of Jesus Christ, the Son of God.” Here, “Christ” is a title meaning ‘anointed one’. Thus, the good news is intrinsically about Jesus: his identity as the Anointed One and his unique status as the Son of God.
* **The Gospel of God’s Grace:** In Acts 20:24, the Apostle Paul speaks of his mission to “testify the gospel of the grace of God.” Grace signifies an undeserved gift. This reveals that the Gospel involves a gift from God, offered not because it is merited, but out of His benevolence.
* **The Gospel of Salvation and Peace:** Romans 1:16 declares the Gospel is “the power of God to salvation for everyone who believes,” breaking down barriers between Jew and Gentile (Greek). Furthermore, Romans 10:15 calls it the “gospel of peace,” pointing to a future state of peace brought about by this message.
* **The Gospel Summarised:** 1 Corinthians 15:1-4 provides a foundational summary. Paul reminds believers of the gospel he preached, “by which also you are saved.” He then states its core historical facts: “that Christ died for our sins according to the Scriptures, and that He was buried, and that He rose again the third day according to the Scriptures.” The Gospel is therefore rooted in the sacrificial death and resurrection of Jesus.
In synthesis, the Gospel is the good news of **salvation and future peace in the Kingdom of God**, made possible by **the grace of God** and **the obedient sacrifice of His Son, Jesus Christ**, and offered to all who believe.
**Old Testament Foundations: The Gospel Preached to Abraham**
A crucial question is whether the Gospel is confined to the New Testament. Scripture shows its foundations were laid much earlier. Galatians 3:8 states explicitly that “the Scripture, foreseeing that God would justify the Gentiles by faith, preached the gospel to Abraham beforehand, saying, ‘In you all the nations shall be blessed.’”
This reference points back to Genesis 12:1-3, where God made profound promises to Abraham: to make him a great nation, to bless those who blessed him, and that “in you all the families of the earth shall be blessed.” These promises—later reaffirmed to Isaac and Jacob—form the bedrock of the Gospel hope. The good news of salvation through Christ is the fulfillment of how **all nations** would be blessed through Abraham’s “seed.”
**The Gospel’s Personal Relevance: Good News for You Today**
How does this ancient message become “good news for you” today? The application is clearly outlined in Galatians 3.
* **Access through Faith in Christ:** Galatians 3:26 declares, “For you are all sons of God through faith in Christ Jesus.” The promise made to Abraham is now extended to anyone with faith in Jesus.
* **The Role of Baptism:** Verse 27 explains, “For as many of you as were baptized into Christ have put on Christ.” Baptism is the God-appointed act of faith that identifies a believer with Christ’s death and resurrection.
* **Unity and Inheritance:** Verses 28-29 reveal the glorious outcome: “There is neither Jew nor Greek, there is neither slave nor free, there is neither male nor female; for you are all one in Christ Jesus. And if you are Christ’s, then you are Abraham’s seed, and heirs according to the promise.” Through the Gospel, all barriers are removed; believers become spiritual descendants of Abraham and heirs to the promises of the Kingdom.
This Gospel was once a mystery hidden in God’s purpose (Ephesians 3:3-9). Now, it has been revealed: the unsearchable riches of Christ, offering salvation to all who heed the call, believe the message, and are baptised into him.
**Conclusion: An Enduring and Open Invitation**
The Gospel is far more than a historical account; it is the living, powerful good news of God’s plan for salvation. It is rooted in promises to Abraham, accomplished through the death and resurrection of Jesus Christ, and open to all people without distinction. It offers a tangible hope—the hope of resurrection, peace, and an inheritance in the coming Kingdom of God. This is why the Gospel remains profoundly relevant. It is an invitation to listen, believe, and stand firm in this hope, linking our lives today to the eternal purpose of God.
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