The elderly victim lost $100,000 to scammers after her friend's Facebook account was hacked. Photo / 123RF
The elderly victim lost $100,000 to scammers after her friend's Facebook account was hacked. Photo / 123RF
The Banking Ombudsman has launched a probe into one of the country’s largest banks after a widowed pensioner was fleeced of $100,000 in a Facebook hacking scam.
The West Auckland victim was tricked into sending the money overseas in the belief it would unlock an imaginary Covid-19 subsidy payment after scammers hacked her friend’s Facebook account and sent her hundreds of fake messages.
And though ASB eventually identified the fraud after the octogenarian had made 13 international money transfers - all of them in person at her local branches with the assistance of ASB staff - none of the funds were recovered, and her family is furious bank staff did not alert relatives or police.
ASB has defended its actions, saying the victim - who lives alone and has banked with ASB for 60 years - authorised the offshore transactions, told staff she knew who was receiving the money and was confident she wasn’t being scammed.
The bank also said it was acting on the victim’s instructions not to alert family or police about the stolen money and had to respect her wishes.
After ASB refused liability, the victim’s daughter-in-law Kim Weston complained to the Banking Ombudsman.
The complaint alleged ASB had failed to protect a vulnerable, elderly customer by not flagging the 13 offshore payments as suspicious - despite the fact she had never sent money overseas before.
Weston told the Herald she wanted someone independent to review how the money was lost, what processes ASB had in place to protect vulnerable customers and whether there had been any failure by the bank.
If liability was identified, Weston wanted the bank forced to reimburse her mother-in-law.
“I think they’ve failed in their duty of care.”
The Banking Ombudsman has now launched a formal investigation into the complaint and written to ASB requesting a raft of documents.
The letter, sent by a Banking Ombudsman resolutions adviser and obtained by the Herald, says the complaint has been “escalated for consideration as a dispute”.
It requests:
Copies of the account mandate, including details about co-signatories on the account.
Bank statements from February 1 to June 30 this year showing the international money transfers.
Diary notes recorded by bank staff for each of the victim’s in-branch visits.
Call recordings between ASB and the victim during the relevant period.
All relevant written correspondence between ASB and the victim.
All relevant policies and procedures ASB considered when processing the international money transfers.
Banking Ombudsman Nicola Sladden.
Banking Ombudsman Nicola Sladden told the Herald she could not comment on specific cases.
In a statement, ASB’s executive general manager of technology and operations, David Bullock, said it was not appropriate to comment on any case under review by the Banking Ombudsman.
“The Banking Ombudsman Scheme provides an independent dispute resolution service for banks and their customers. Customers who are not satisfied with the outcome of a bank’s review into an issue may request to have this looked at by the Banking Ombudsman.”
Bullock said ASB was a member of the scheme and worked collaboratively with the Banking Ombudsman.
The victim’s family said they only learned the pensioner’s money was gone by chance two months after ASB identified the fraud when relatives reviewed her bank statements.
The family alerted police, who launched an immediate investigation, which included contacting Australian police through Interpol.
New South Wales officers have now identified the recipient bank accounts, but say the months-long delay in reporting the fraud meant the cash was likely long gone and crucial CCTV footage that could have identified the offenders has most likely been wiped.
Banking experts told the Herald in their view, ASB not going directly to police was a “serious lack of judgement” and “not a good look” that may have undermined the chances of catching the criminals and put other potential victims at risk.
ASB CEO Vittoria Shortt.
In response, ASB said it “encouraged” the victim to speak to her family and police, but she did not want to do so.
ASB also defended its security systems as robust.
The victim had authorised the transactions and repeatedly confirmed to bank staff that she knew who was receiving the money, was confident she wasn’t being scammed and was aware the funds would likely be lost if she’d been defrauded.
There was nothing in her responses that raised suspicion about the transfers, the bank said.
The fraud was detected when a new teller sought advice about the final transaction from a manager, who became suspicious about the pattern of money transfers. The manager froze the woman’s online banking and alerted ASB’s fraud department.
When questioned by staff, the woman said “she had made payments like this in the past, and that the funds were to help a friend”.
As the woman had authorised the transactions and the bank had taken immediate steps to try to recover the funds, ASB was not liable.
