Consumers are being urgently warned to exercise caution when receiving phone calls and texts that appear to be from their banks, as an alarming rise in highly sophisticated impersonation scams has resulted in Australians losing their life savings.

The Australian Competition and Consumer Commission's Scamwatch received a staggering 14,603 reports of bank impersonation scams in 2022, with losses exceeding $20 million. The total losses from phone and text scams saw a significant increase, surpassing $169 million.

These scammers have adopted new technologies to deceive their victims, making their calls appear to originate from legitimate bank numbers or sending text messages that seamlessly integrate into existing conversation threads with genuine bank messages.

ACCC Deputy Chair Catriona Lowe expressed deep concern over the convincing nature of these scams, which makes them incredibly difficult to detect. What is particularly alarming is that victims' savings accounts are being emptied completely, with average losses of $22,000 and some cases reporting losses ranging from $40,000 to $800,000. The financial and emotional devastation caused by these scams cannot be overstated.

Lowe highlighted a case where a man lost over $500,000 after receiving a call from someone claiming to be from a major bank's security department. In another instance, a man lost $38,000 after receiving a scam text message that appeared alongside genuine bank messages, leading him to believe it was legitimate. Unfortunately, he lost everything after contacting the fraud team through the number provided in the text.

Bank impersonation scams target not only the big four banks but also other financial institutions. Scammers often create a sense of urgency by claiming fraudulent activity or account freezes, pressuring victims into taking immediate action.

"It is critical to remember that no matter how legitimate the call or message seems, a bank won't ask you to urgently transfer funds," cautioned Lowe.

She advised recipients of SMS messages with telephone numbers to avoid using them and instead call their bank directly using independently sourced contact details. If someone claiming to be from a bank requests money transfer to "keep it safe," asking for a reference number and calling the bank back independently is recommended.

One-time security codes, pins, tokens, and online banking passwords should never be shared with anyone over the phone. If you suspect you have fallen victim to a scam, contact your bank or financial institution immediately.

Lowe also highlighted that recent mass data breaches have caused many Australians to be on high alert for suspicious account activity. Unfortunately, scammers have taken advantage of this heightened state of concern, leading consumers to act out of fear that their accounts have been compromised.

To protect themselves, Australians must remain vigilant and verify any bank communications independently. By raising awareness and taking proactive measures, individuals can safeguard their hard-earned savings and prevent falling victim to these devastating scams.

Signs of a bank impersonation scam:

1. Sense of urgency or threat: Be wary if the message you receive states that your bank account has been accessed, locked, or that an unauthorized payment has been made. Scammers often use these tactics to create a sense of alarm and prompt immediate action.
2. Different messaging style: Pay attention if the message looks different from other messages in the SMS thread, such as using unfamiliar wording or phrases. This could be an indication of a scam.
3. Suspicious links: Never click on any suspicious-looking links included in the message. Scammers may use these links to trick you into providing personal information or gaining access to your devices.
4. Provided telephone number: If the SMS includes a telephone number to call, it's important to independently find your bank's contact information rather than using the number provided. Scammers can make it appear as if they are calling from a legitimate bank, so it's crucial to verify independently.
5. Money transfer requests: In a bank impersonation scam, the caller may ask you to transfer money to a different account under the pretense of keeping it safe or for further investigation. Remember that this is not standard procedure for a bank and is most likely a scam.

It's essential to stay vigilant and protect yourself from these scams. Remember to never share personal or financial information with unknown callers or text senders. If you suspect that you have received a bank impersonation scam message, report it to your bank immediately and follow their guidance on how to proceed.

Stay informed and share this information with family and friends to help prevent others from falling victim to these scams.

(Source: ACCC - Australian Competition and Consumer Commission)