Experts suggest expanding the framework to include stronger protections against malware and other scams.
Singapore – A proposed framework that would hold financial institutions (FIs) and telecommunication providers (telcos) accountable in cases of scams has garnered positive feedback, but experts believe more can be done to protect vulnerable groups and tackle the growing threat of malware scams.
The framework comes at a time when scams are a significant issue, with 22,339 scam cases reported in the first half of 2023. Phishing scams alone accounted for nearly 3,000 of these cases. Experts have welcomed the proposal for its efforts to define responsibility for fraud costs but argue that it doesn’t go far enough in addressing the increasing sophistication of scams, including malware fraud.
Raju Chellam, a cybersecurity expert, proposed extending the 12-hour cooling-off period for high-risk transactions to include all transactions made by vulnerable groups, such as seniors and those with mental disabilities. He also suggested that banks create special, more secure accounts for these groups, using advanced AI and analytics to monitor suspicious overseas transactions.
The framework, which focuses primarily on phishing scams, aims to make financial institutions and telecommunication providers more accountable for reimbursing victims of fraud. In a similar move, the UK is considering legislation that would force banks to reimburse scam victims within 48 hours for certain types of fraud, including online scams where fraudsters impersonate banks.
Melvin Yong, president of the Consumers Association of Singapore, endorsed the proposal, calling it a step forward in consumer protection. However, both Yong and Sylvia Lim, chairwoman of the Workers’ Party, highlighted the need to broaden the framework to include malware scams, which have been on the rise. Malware scams involve fraudsters taking control of a victim’s device to steal funds, without the need to impersonate a legitimate business or trick the victim into entering their credentials on a fake platform.
Under the current proposal, victims of malware scams would likely bear the loss entirely, as these scams are more difficult to trace and prevent. The regulators have stated that specific measures related to malware scams are still under development.
Experts also emphasized the need for collaborative action from tech companies, e-commerce platforms, and other stakeholders in the digital ecosystem to further strengthen anti-scam measures. The proposal highlights the role of telcos, which have been included as responsible parties in this framework for the first time, as they facilitate communication between scammers and victims.
Despite these steps, experts believe more urgent action is needed to keep pace with the sophistication of scams and the growing vulnerabilities of digital consumers.
