After $1.25 million loss over deceptive text messages, scam victims take banking giant to task
- Replies 20
A group of HSBC Australia customers have found themselves at the mercy of a sophisticated scam, losing a staggering total of $1.25 million.
Now, they're fighting back, demanding the global banking giant address what they believe are significant flaws in its digital security.
The scam, which has affected at least 24 individuals across Australia since April 2023, began with a seemingly innocuous text message.
The message appeared to come from HSBC, even showing up in the same thread as previous legitimate alerts from the bank.
Scamwatch, the federal government-backed agency established as its anti-scam advocacy arm, warned everyone that ‘scammers are targeting HSBC customers with calls and texts that appear to be from their bank’, known as spoofing.
Customers have been called from a number that ‘looks to be the genuine HSBC phone line’.
Gerald Chin, a Sydney resident and one of the victims, lost $50,000 to this scam last year.
He received a text message that appeared to be from HSBC, warning him of a potential breach in his account.
When he called the number provided in the message, a scammer posing as an HSBC representative convinced him to share his username, personal details, and bank codes.
The fraudster then accessed his account and drained his savings, shattering his plans of surprising his parents with an overseas holiday.
The victims, who have each lost between $50,000 and $100,000, have banded together in a coordinated effort to recover their stolen funds and compel HSBC to address the alleged security gaps.
They have written a joint letter to HSBC Australia's CEO, Antony Shaw, and Group Chief, Noel Quinn, but have only received a ‘boilerplate response’ from the bank's advocacy team.
Chin, set for mediation through the Australian Financial Complaints Authority (AFCA) in March, said ‘he will be considering all possible options’ if he does not secure a full refund.
So far, HSBC has only been able to recover $1 of his stolen money.
Chin said the situation left him struggling to service his mortgage and ‘infuriated’ that he never received a transaction notification, which ‘could have prompted me to act earlier’.
‘I think it’s disgusting how the bank has dealt with the whole saga,’ he said.
‘Similar incidents were reported to HSBC early on, but the bank has not taken any concrete actions.
Chin also labelled the bank’s attempts to mitigate concerns ‘deplorable’.
‘Generic information on how to protect yourself from scams was unhelpful and failed to raise awareness about how the scammers operated.’
‘(HSBC) continues to use SMS knowing that this has been compromised, and I have got a scam text only a few weeks back on a new HSBC number used to reset my account.’
Another customer complained that this situation would not have happened anywhere else because of the longer holds on money transfers to new recipients.
‘Had we banked at another bank, this would have been blocked,’ they said.
‘HSBC [is] the only [one] that can prevent these scams, as other banks have, and are therefore responsible.’
In response, HSBC stated that it would not discuss individual cases for privacy reasons but stressed action was being taken on their end.
‘HSBC takes customer security seriously, and we investigate all reported customer issues, with the outcome dependent on each set of circumstances,’ the bank said.
‘The bank is investing heavily to protect our customers and play our part in supporting the wider financial services industry on this issue.’
HSBC has educational tools on its app, website, online banking, and inside its branches on how to protect a customer from scams. It has also been working with the Australian Banking Association in a bid to win the ‘war’ against scams.
The victims' plight has caught the attention of Scamwatch, which issued a warning about scammers targeting HSBC customers with spoofing calls and texts.
‘They claim there was an attempt to gain access to your account or fraudulent activity,’ Scamwatch warned.
‘The scammer asks for your username, personal details and bank codes to gain access to your account.’
In 2023, the Australian Financial Complaints Authority (AFCA) reported a record number of complaints against banks, surpassing 100,000 reports.
This marked a 23 per cent rise from the previous year and included grievances from individuals and businesses unable to resolve disputes with their banks.
‘The volume of complaints escalated to AFCA has been increasing at an unsustainable rate,’ AFCA’s Chief Ombudsman and Chief Executive Officer David Locke said.
‘Scam-related complaints to AFCA have nearly doubled between 2022 and 2023. They continue to be of great concern to us.’
‘We are also seeing the impact of increased interest rates and cost of living pressures, with complaints involving financial hardship also significantly higher.’
Have you or someone you know been a victim of a similar scam? Share them with us in the comments below.
Now, they're fighting back, demanding the global banking giant address what they believe are significant flaws in its digital security.
The scam, which has affected at least 24 individuals across Australia since April 2023, began with a seemingly innocuous text message.
The message appeared to come from HSBC, even showing up in the same thread as previous legitimate alerts from the bank.
More HSBC customers have fallen prey to scams. Credit: Shutterstock
Scamwatch, the federal government-backed agency established as its anti-scam advocacy arm, warned everyone that ‘scammers are targeting HSBC customers with calls and texts that appear to be from their bank’, known as spoofing.
Customers have been called from a number that ‘looks to be the genuine HSBC phone line’.
Gerald Chin, a Sydney resident and one of the victims, lost $50,000 to this scam last year.
He received a text message that appeared to be from HSBC, warning him of a potential breach in his account.
When he called the number provided in the message, a scammer posing as an HSBC representative convinced him to share his username, personal details, and bank codes.
The fraudster then accessed his account and drained his savings, shattering his plans of surprising his parents with an overseas holiday.
The victims, who have each lost between $50,000 and $100,000, have banded together in a coordinated effort to recover their stolen funds and compel HSBC to address the alleged security gaps.
They have written a joint letter to HSBC Australia's CEO, Antony Shaw, and Group Chief, Noel Quinn, but have only received a ‘boilerplate response’ from the bank's advocacy team.
Chin, set for mediation through the Australian Financial Complaints Authority (AFCA) in March, said ‘he will be considering all possible options’ if he does not secure a full refund.
So far, HSBC has only been able to recover $1 of his stolen money.
Chin said the situation left him struggling to service his mortgage and ‘infuriated’ that he never received a transaction notification, which ‘could have prompted me to act earlier’.
‘I think it’s disgusting how the bank has dealt with the whole saga,’ he said.
‘Similar incidents were reported to HSBC early on, but the bank has not taken any concrete actions.
Chin also labelled the bank’s attempts to mitigate concerns ‘deplorable’.
‘Generic information on how to protect yourself from scams was unhelpful and failed to raise awareness about how the scammers operated.’
‘(HSBC) continues to use SMS knowing that this has been compromised, and I have got a scam text only a few weeks back on a new HSBC number used to reset my account.’
Another customer complained that this situation would not have happened anywhere else because of the longer holds on money transfers to new recipients.
‘Had we banked at another bank, this would have been blocked,’ they said.
‘HSBC [is] the only [one] that can prevent these scams, as other banks have, and are therefore responsible.’
Customers said HSBC is responsible for the loss of their savings. Credit: Shutterstock
In response, HSBC stated that it would not discuss individual cases for privacy reasons but stressed action was being taken on their end.
‘HSBC takes customer security seriously, and we investigate all reported customer issues, with the outcome dependent on each set of circumstances,’ the bank said.
‘The bank is investing heavily to protect our customers and play our part in supporting the wider financial services industry on this issue.’
HSBC has educational tools on its app, website, online banking, and inside its branches on how to protect a customer from scams. It has also been working with the Australian Banking Association in a bid to win the ‘war’ against scams.
The victims' plight has caught the attention of Scamwatch, which issued a warning about scammers targeting HSBC customers with spoofing calls and texts.
‘They claim there was an attempt to gain access to your account or fraudulent activity,’ Scamwatch warned.
‘The scammer asks for your username, personal details and bank codes to gain access to your account.’
In 2023, the Australian Financial Complaints Authority (AFCA) reported a record number of complaints against banks, surpassing 100,000 reports.
This marked a 23 per cent rise from the previous year and included grievances from individuals and businesses unable to resolve disputes with their banks.
‘The volume of complaints escalated to AFCA has been increasing at an unsustainable rate,’ AFCA’s Chief Ombudsman and Chief Executive Officer David Locke said.
‘Scam-related complaints to AFCA have nearly doubled between 2022 and 2023. They continue to be of great concern to us.’
‘We are also seeing the impact of increased interest rates and cost of living pressures, with complaints involving financial hardship also significantly higher.’
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