Surge in Fraud Spurs Record Financial Complaints

2

The Australian Financial Complaints Authority (AFCA) recently published its annual report, revealing that disputes escalated to the ombudsman for the 2023/24 financial year have reached an all-time high.

The dramatic spike in complaints highlights the impact of fraudulent activities on consumers and financial institutions alike. This new wave of fraud has left many Australians grappling with the repercussions, resulting in a surge of submissions to the AFCA.

The most common types of scams reported include phishing, identity theft, and investment fraud. Each of these exploits a different vulnerability in the financial security of individuals, making it harder for authorities to combat the growing threat effectively.

• Phishing: Deceptive efforts to obtain sensitive personal information such as passwords and credit card details.
• Identity Theft: Fraudulent acquisition and use of someone's personal identity data, usually for financial gain.
• Investment Fraud: Scams involving false investment opportunities promising high returns for minimal risk.

AFCA's Chief Ombudsman and CEO, David Locke, urged both consumers and financial institutions to be more vigilant in safeguarding sensitive information. He stressed the importance of education and awareness in preventing fraud.

"The increase we've seen is staggering," Locke commented. "It reflects not just the creativity of scammers but also the need for a robust approach to fraud prevention and financial literacy."

Comparing the new data with previous years, it's evident that scammers are evolving their strategies. In the 2021/22 financial year, financial complaints were significantly lower, indicating that fraud tactics have become more sophisticated and harder to detect.

According to AFCA's report, the financial services sector must innovate and adapt rapidly to counter these threats. Implementing advanced security measures, conducting regular audits, and enhancing user education can foster a more resilient financial ecosystem.

The original article on this topic can be found on AAP's website by Holly Hales.

Published:Monday, 5th Aug 2024
Source: Paige Estritori

Share this news item:

Finance News

Clear

ASIC Releases Updated Legislation for Financial Advice

16 Sep 2025: Paige Estritori

The Australian Securities and Investments Commission (ASIC) has introduced a new, consolidated legislative instrument that relates to financial advice. This update follows through on ASIC's May announcement regarding the remake of three existing advice-related instruments. - read more

Commonwealth Bank Challenges RBA's Card Fee Reform

12 Sep 2025: Paige Estritori

Australia’s leading financial institution, the Commonwealth Bank of Australia, has openly criticised the Reserve Bank of Australia (RBA) for its calculations related to a proposed reduction in debit and credit card transaction fees. The RBA suggested that the reform would save Australian businesses $1.2 billion annually and benefit the majority of companies, a claim that the Commonwealth Bank strongly disputes. - read more

Ongoing Consumer Spending Surge Threatens Future Interest Rate Cuts

11 Sep 2025: Paige Estritori

Amid a period of robust consumer spending, Australia's mortgage holders may face limited future interest-rate cuts. The Commonwealth Bank has observed Australians increasing their spending over the last six months, spurred by rising incomes, a robust job market, and previously lowered interest rates. - read more

CSLR Funding Concerns as Special Levy Decision Remains Pending

11 Sep 2025: Paige Estritori

The Compensation Scheme of Last Resort (CSLR) recently highlighted potential delays in compensation payments due to insufficient special levy funds. In July, the CSLR's proposed FY2025–26 levy plan allocated $67.29 million for financial advisers, surpassing the $20 million limit set for the subsector. This shortfall of $47.29 million prompted the Treasury to initiate a consultation in August to determine funding solutions for the excess levy. - read more

Retiree Surge to Drive Demand for Financial Advisers in Australia

10 Sep 2025: Paige Estritori

A recent study by Adviser Ratings, as outlined in the 2025 Australian Financial Advice Landscape Report, indicates that the number of financial advisers in Australia will need to increase significantly. From the present count of 15,500 advisers, the industry is expected to require more than 50,000 over the next thirty years to cater to a growing retiree population. - read more

Click for more Finance News