The worst of the coronavirus crisis may be over, but the business regulator is warning that new threats are emerging that could rob Australians of their money.
Scams, predatory loans, inadequate hardship provisions and other bad behavior have cost Australians thousands of dollars since the pandemic struck.
And more Australians could fall victim to bad behavior and shady operators, according to business watchdog ASIC.
“At a time when the COVID-19 pandemic worries many many consumers, the risk of exploitation by unscrupulous operators is greater,” warned the regulator.
“While we recognize that participants in the Australian financial services industry are currently under tremendous pressure, we strongly expect them to continue to act fairly and in the best interests of consumers.”
ASIC chief James Shipton has warned those seeking to take advantage of customers that the regulator will take “swift enforcement action” to protect Australians.
He also signaled his intention to work closely with the financial services industry to minimize damage and ensure companies behave in a “fair and transparent” manner.
Scams on the rise as pandemic sets in
ASIC’s renewed focus on consumer protection comes as more Australians fall victim to increasingly costly scams.
The “marked increase” in these scams is even more troubling given that many Australians struggle with reduced incomes and financial stress, ASIC said.
Delia Rickard, Vice President of ACCC, said The new daily there has been “a real explosion of scams” so far this year.
“We see a lot of investment scams, a whole bunch of COVID-19 scams – we’ve had around 3,000 complaints about scams with a COVID link,” she said.
And the crooks are proving to be “infinitely creative”, finding new and ever more devious ways to rob unsuspecting Australians.
More recently, Ms. Rickard said, con artists pose as employers, offering jobs to recently laid off workers.
But the job comes with a catch – before workers can begin, they must undergo a $ 110 coronavirus ‘test’.
Once the money for the test is transferred, the fraudulent employers disappear, leaving unemployed Australians in an even worse situation than before.
“We’ve had a few reports on this this week,” Ms. Rickard warned.
Other crooks steal sensitive MyGov account data via bogus surveys supposedly aimed at supermarkets like Coles and Woolworths.
Hidden among a sea of trivial questions are several traps set by crooks to capture vital data that they can use to steal pension money.
There’s only one surefire way to make sure you don’t become the next victim of scammers, Ms. Rickard added:
Always keep your guard.
“Never believe that the communication that comes to you unexpectedly is from who it says it is from.”
Before giving any information – however frivolous – Ms Rickard said it was essential to independently verify the identity of those who asked for it.
Do not use the contact details provided to you. Instead, find the correct contact details and call or email the company or person who originally “contacted” you to make sure the message was genuine.
Desperate Australians at risk of spiraling debt
Scams aren’t the only worry – rising unemployment and falling wages mean many households can no longer cover their bills.
In desperation, many will use their credit cards to the max or turn to payday lenders to keep food on the table and a roof over their heads and the heads of their families.
Unfortunately, these debt-based products could very easily “push them over the financial edge,” said Maura Angle, director of community engagement at the National Debt Helpline. The new daily.
“The problem for a lot of people is that they are more tempted to use payday lenders or buy now-pay later programs when they run out of money and are having trouble paying their bills.
“If you don’t have your usual income and the bills pile up, taking out a payday loan or maxing out your credit cards is going to plunge you into a spiral of debt, which can be difficult to get out of.
Research by the Stop The Debt Trap Alliance – a coalition of more than 20 activist consumer groups – has found that interest payments on these short-term loans can be as high as 400% per year.
Repayments are so expensive that many customers are forced to extend their loan or borrow more to stay on top of repayments.
Ms. Angle’s advice is to avoid payday lenders or credit cards if you have problems with bills or debts.
Try financial counseling instead – this free service can help consolidate debt, suspend repayments, make payment plans, and help create a handy family budget.