Communications Alliance urges safe harbour in scams law

The Communications Alliance has advocated for a safe harbour from potential 'quadruple jeopardy' liabilities in the new Scams Prevention Framework legislation.

Telcos have reportedly blocked over 2 billion scam calls and nearly 700 million scam messages since 2020, according to Luke Coleman, CEO of the Communications Alliance.

"Telcos have been at the forefront of the fight against scams," Coleman stated, noting the existing industry code that guides telcos to identify, trace, block, report, and disrupt such communications.

The draft framework currently suggests that telecommunications companies could face four concurrent enforcement actions even while complying with the defined industry code. These actions could arise from different regulators or courts, leading to the possibility of penalties despite adherence to an industry-established code.

"If a telco complies with the industry code, it should have safe harbour from enforcement under the three other avenues of liability – the ACCC, the Australian Financial Complaints Authority (AFCA), and potential legal action through the courts," Coleman argued. This measure aims to protect telcos from excessive penalties while still maintaining accountability for industry standards.

The Communications Alliance supports the government's goals to reduce scams across multiple sectors, including banking and digital platforms. Coleman suggested that alterations to the framework would enhance enforcement clarity, improve flexibility, and protect consumers without subjecting the industry to unnecessary liability.

"Our proposed changes would make the framework more clearly enforceable, more flexible, and would better protect consumers without exposing industry to undue liability," Coleman explained.

Under the proposed legislative structure, telcos might be liable to: (1) regulation from ACMA as the telecommunications sector overseer, (2) regulation from the ACCC based on SPF principles, (3) resolution via AFCA as the external dispute resolution (EDR) body, and (4) potential civil actions from SPF consumers including class actions.

"Under Comms Alliance's proposed amendments, safe harbour would not apply if a telco was found to be in breach of the industry code, and could then be subject to enforcement action or compensation through other mechanisms," outlined Coleman on further accountability measures under compliant circumstances.

The initiative to combat scams has shown some success, highlighted by a 13% reduction in financial losses due to scams between 2022 and 2023. Additionally, the median amount lost by consumers decreased by 50%, while scam reporting rose by over 18%.

"There are positive signs that actions by Government and industry are starting to turn the tide against scammers," Coleman noted. Nonetheless, he emphasized the necessity of enforcing robust technical measures.

Coleman pointed to the implementation of initiatives like the SMS Sender ID Registry and the reform of telephone number usage rights as enhancements to the SPF.

"The telecoms industry has already instituted a range of technical measures to fight scams, and these will be bolstered by new SMS Sender ID requirements which will prevent scammers from pretending to be toll road operators or banks when sending messages to consumers," he stated.

To streamline consumer complaint processes regarding scams, Coleman suggested that these should be exclusively handled by AFCA to avoid duplication across other bodies, such as the Telecommunications Industry Ombudsman (TIO).