YOURSAY | ‘There is no need to keep wanting to study things further.’

Scams: PM supports UK model for banks to refund fraud victims

LimeHorse5802: I fully support the notion of holding banks legally responsible for refunding victims of scams in full.

Scam statistics over the last 10 months reveal no signs of abating, despite the enactment of laws penalising individuals who voluntarily serve as “mules.”

These measures address symptoms rather than the root cause of the problem. It is high time to compel banks to take their responsibilities seriously.

A balanced approach might involve splitting the financial burden of scam-related losses equally between the victim’s bank and the bank holding the “mule” account.

This division would create stronger incentives for both institutions to act proactively. Here are some of the systemic issues that need urgent attention:

1. Customer protection as a shared responsibility. Today, banks hide behind the narrative that “customers should protect their money themselves.”

This attitude removes any motivation for banks to invest in state-of-the-art heuristic systems capable of instantaneously flagging transactions with a high fraud propensity.

Shockingly, some banks have outrightly admitted that their core banking systems are not designed for fraud detection and prevention.

This excuse undermines the trust customers place in banks as custodians of their hard-earned money.

2. Investing in subpar fraud detection systems. When banks do invest in fraud prevention, they often purchase outdated rule-based systems that fail to incorporate advanced machine learning algorithms.

These systems struggle to adapt to evolving scam patterns and frequently generate high levels of “false positives” (flagging legitimate transactions as fraudulent) and “false negatives” (failing to detect actual fraudulent transactions).

This not only creates inefficiencies but also frustrates customers who face unwarranted disruptions while performing legitimate transactions.

3. Ineffective Identification of mule accounts. Banks primarily rely on rudimentary “know your customer” (KYC) processes to screen individuals before allowing them to open accounts.

While this may prevent individuals with prior records as “mules” from opening new accounts, it does little to identify mule accounts through transactional patterns and behavioural anomalies.

Many banks justify this inaction by citing costs and the limitations of their systems.

As a result, individuals with no prior history of serving as mules can still open and operate accounts for illicit purposes.

4. Reputational risk is a weak deterrent and is often overstated. Despite numerous fraud and scam incidents globally, many banks continue to thrive by rebuilding their image through attractive interest rates, corporate social responsibility (CSR) initiatives, and other public relations efforts.

This underscores the need for stricter regulatory measures, as market forces alone do not sufficiently deter banks from laxity in fraud prevention.

If Malaysia is serious about eliminating financial scams, regulators must take a firm stance to ensure the banking sector aligns with global best practices.

This includes mandating investments in advanced fraud detection systems, enforcing stricter accountability for losses, and requiring the proactive identification of mule accounts through transactional monitoring and behavioural analysis.

Only then will we see meaningful progress in combating this pervasive issue.

FitnessPro: The banks will never agree. In Malaysia, it will always be the rakyat who will be the victim and who has to bear the losses.

The big bosses, the big powerhouses who own millions and billions do not have to compensate the small fries like us the rakyat.

From there, the politicians always stand on the side of those with money. The rakyat has to bear it when the prices of goods and services increase.

They are the ones who suffer from victimisation and losses.

It has been like this all this while. Would it be any different moving forward? I wish and wish you would prove me wrong.

GraySalmon8323: Something as simple as Malaysian residents, whether Malaysians or foreigners are allowed to lend their name to mule accounts with no consequences.

It says plenty for Malaysian law enforcement.

An ex-prime minister who scammed the Treasury has been given a partial pardon.

Many others have done the same and are living the high life - they scammed the taxpayers and the Treasury through decades of rent-seeking aka corruption with collusion with senior civil servants.

Now someone is setting their sights on the banks! With the expected collusion between big-time scammers and “victims”, the real victims may well turn out to be banks!

Nada Villa: (There is) No need to keep wanting to study things further. Scams have been going on for so long and yet government committees still need to study it further.

What further “lawatan sambil belajar” (study trips) are needed? Bank Negara and the Securities Commission have enough data and comparative solutions to make the banks comply. All that is left now is political will.

Hmmm: If you want to be serious, you need to increase the penalty for mule account holders.

At present, they only receive a paltry fine of a few hundred ringgit if found guilty.

The scammers can easily pay for them.

The authorities should increase the fine and also include imprisonment.

These mule accounts must be closed, and they are not allowed to open another account at any bank either permanently or for at least a set number of years.

Similarly, telco number owners whose phone numbers have been used to scam people. With these, I believe many cases can be stopped until the scammers find a different modus operandi.

Fair Play: A possibility? The banking system that we know today could be changed totally soon. Customers will be king again.

With gold or asset-backed currencies of all nations of the world in the pipeline, inflation (excessive money printing of fiat paper money) could be a thing of the past.

BlueCougar1744: The banks, telcos and many other institutions are liable as most of the data and information of individuals are breached, and many phone users constantly receive calls from unknown parties portraying that they are from the banks, the police, Inland Revenue Board and others to scam victims.

Address these issues first!

punchie101: Would like to see the first scammer caught, jailed and caned. They are very cunning.

All transactions are via WhatsApp but never reveal their voice, face or address. If you want to avoid being conned, agree to part with your money In front of a lawyer.

Ask the scammer to meet you at the lawyer’s office. He will never surface!

P Ramlee: Cane the mules first before you force the banks to refund.

Right now, the mules are happily making quick money without being appropriately penalised.

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