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Lawmakers in Australia have passed what they believe are the "world’s toughest" anti-scam laws, as the Albanese government makes good on one of its key election pledges.
Last week, both houses of the Australian parliament passed the Scams Prevention Framework Bill 2025, a foundational piece of legislation in the country’s fight against scams.
The bill amends the Competition and Consumer Act 2010 to establish multi-sector scam prevention standards, targeting banks, telcos and social media companies.
If businesses fail to uphold these standards, they can be issued civil penalties of up to A$50m ($32m) per offence.
In addition, if a business’ failure to meet its obligations results in a customer being scammed, the scam victim will have a clear pathway to redress, including through compensation.
Stephen Jones, assistant treasurer and a key architect of the bill, said that businesses will now have a “substantial incentive” to ensure that consumers are protected by “ironclad” scam defences.
“Our laws give Australia the strongest defences against scammers and put us ahead of the world in scams prevention and protection,” he said.
“This is a promise we made ahead of the 2022 election and will make a genuine difference in the lives of every Australian.
“These new laws will keep Australia one step ahead of criminal scammers.”
The passage of the bill was welcomed by the Australian Banking Association (ABA), whose CEO, Anna Bligh, has been outspoken on the need to bring social media companies under specific anti-scam regulations.
“This is a game-changer in the fight against scammers, and will ensure all parts of the scams chain are held to account for their responsibilities to prevent, detect, report, disrupt and respond to scams,” said Bligh.
“Our world-first approach will make sure telcos and digital platforms have strong safeguards in place to stop scams from reaching consumers.”
In 2024, according to data from the government’s Scamwatch centre, losses to scams fell 33 percent year-on-year.
This follows an investment of A$168m ($107m) in scam prevention measures by the Albanese government, including the establishment, in July 2023, of the National Anti-Scam Centre (NACC).
“Losses are going down and that’s a good sign, but Australians are still losing far too much,” said Jones.
“We want to make Australia the toughest target for scammers and our laws will put Australia at the head of the pack.”
Obligations under the Scams Prevention Framework
The Scams Prevention Framework includes both universal obligations, which apply to all designated sectors, and sector-specific obligations.
Examples of universal obligations include regularly training staff in scam identification and response, and regularly assessing the effectiveness of existing anti-scam policies and procedures.
Users of all regulated services must also be offered a “friendly and accessible” method for making a complaint about a scam, including a phone number or online mechanism that can be “reached easily”.
For social media and search platforms, sector-specific obligations include ID verification for advertisers and a requirement to investigate all reported scam adverts within 48 hours. Any scam content detected must then be removed within 24 hours.
Banks will be required to verify payee details before transferring funds, and telcos will be required to detect and disrupt scam numbers sending texts and calls to potential victims.
The question of compensation
The Scams Prevention Framework does not mandate that designated businesses compensate victims of scams. However, it does provide redress mechanisms where a regulated entity has fallen short of its enforceable obligations.
These redress mechanisms include internal and external dispute resolution processes, plus the option of taking legal action against the entity.
Each of these channels could result in the scam victim being compensated to the value of their loss or financial damage suffered.
In its explanatory memorandum, the Treasury said it expects regulated entities to provide compensation and/or another appropriate remedy to the consumer through an internal dispute resolution process.
“If a regulated entity determines that its failure to comply with the framework caused loss or damage to the consumer, but does not provide compensation, the regulated entity should be prepared to justify this position if the matter proceeds to external dispute resolution or court action for damages,” it said.
A Treasury minister may authorise external dispute resolution schemes, covering one or more of the designated sectors under the framework.
This may include an existing scheme, such as the Australian Financial Complaints Authority (AFCA), or a new scheme.
In circumstances where a court considers it is appropriate to order an entity to pay both a civil penalty and to compensate a victim, priority will be given to compensation, if the defendant does not have sufficient resources to pay both.
Statutory review
To evaluate the effectiveness of the Scams Prevention Framework, a Treasury minister is required to initiate a review of its provisions at the end of its first three years in operation.
The review will focus on the effectiveness of the dispute resolution framework, including the experiences of consumers in accessing compensation and AFCA’s role as an authorised external dispute resolution mechanism.
It will also assess the effectiveness of the penalty provisions in deterring violations of the framework.
