The Unsettling Encounter of a Scam Victim with Her Banking Institution

An Unfortunate Scam Incident

In an unfortunate series of events, an elderly woman named Angela Fitzwater fell prey to a bank scam, losing an enormous sum of $26,000. This incident was not isolated, but rather, the second of such unfortunate instances she encountered this year.

Her distress was not only due to the financial loss but also the reaction of her banking institution, Bendigo Bank, which she felt was indifferent and unhelpful. In her words, "The bottom line is the bank just doesn't give a damn, they don't care."

The Scam Unfolds

The scam unfolded when Angela received a WhatsApp message, impersonating her son, Alex. The message informed her that her son had smashed his phone and was using a temporary number. The impersonator then requested her to transfer $3,000 to pay an urgent bill, promising to repay her once he regained access to his account. Trusting the message to be from her son, Angela transferred an amount of $10,000.

Reporting the Scam

As soon as she realized that she had been scammed, Angela immediately contacted her bank. The customer service representative from Bendigo Bank expressed sympathy but was unable to reach the bank's fraud department. She was assured that the incident would be investigated, but the representative couldn't guarantee the reimbursement of the stolen money.

Waiting for Bank's Response

Angela made numerous attempts to contact Bendigo Bank over the next three months, seeking help and answers. The bank's call logs indicate that its customer service representatives repeatedly failed to connect with its own fraud department. Angela received only one call back from the bank, and her numerous emails seeking information and answers went unanswered.

During this period, Angela was already dealing with the recent loss of her husband, a cancer diagnosis, and the stress of losing her money. The bank's lack of response added to her distress.

The Bank's Disappointing Response

After more than three months, Angela finally received an email from Bendigo Bank. The bank informed her that they had investigated the matter and attempted to recover her funds, but were unsuccessful. The email mentioned, "As you authorised and completed the payments through banking, unfortunately, the bank has no further recovery rights for reimbursement."

This response from Bendigo Bank raised serious concerns. Steph Tonkin, CEO of the Consumer Action Law Centre, remarked, "Bendigo Bank couldn't contact their own fraud department, and in scams cases, time is of the essence. They're blaming her for having been scammed."

A Second Scam

Tragically, Angela became the victim of a scam for the second time in the same year. This time, the scammers impersonated her bank's fraud department. They convinced her to share her security details, quickly transferring $40,000 from her savings account and purchasing $16,000 worth of cryptocurrency in smaller transactions. The bank did not notify Angela of this suspicious activity, and she only discovered the loss when her card was declined at a shop.

Bank's Advice and Response

Following the second scam, Angela and her son received conflicting advice from Bendigo Bank and were told to have Angela's phone wiped before the bank would reopen her online banking access. This advice was confusing and seemed unnecessary since Angela's phone's security hadn't been compromised — she had given out her security code.

The Bank's Position

Bendigo Bank did not respond to detailed questions about Angela's case, citing privacy reasons. In a statement, it stated that the bank took cyber security very seriously and used a combination of standard industry practices to protect its customers. It further mentioned, "It goes without saying when the bank is at fault, we will reimburse our customers for the loss of funds. It is important that customers take steps to protect themselves and do not share their passwords."

Broader Issue of Bank Scams

Angela's case is not an isolated one. The major Australian banks — ANZ, Commonwealth Bank, NAB, and Westpac — have also been criticized for their response to scams. According to a report, about 31,100 customers at these banks collectively lost more than $558 million to scams in the 2021-22 financial year.

The Need for Urgent Reforms

Cases like Angela's highlight the urgent need for reform in the banking sector's approach to scams. Steph Tonkin of the Consumer Action Law Centre emphasizes the need for the federal government to introduce its announced code of practice for the banks to improve their prevention and response to scams, with reimbursement being a part of it.

"The point with reimbursement is not only does it help the customer, it provides an incentive for banks to detect and prevent scams from taking place in the first place," she explains.

Alex Fitzwater shares this sentiment, stating, "Now that the banks have such control over our financial lives, it's incumbent on them to protect us from threats."

As a closing note, it is crucial for individuals to stay vigilant and aware of potential scams and to always verify any unusual requests for money, even if they appear to come from a trusted source.