Treasury has published an exposure draft of legislation to establish a Scams Prevention Framework (SPF) in a new part of the Competition and Consumer Act 2010.
The Framework for protecting against scams will have the following features:
- overarching principles that apply to regulated entities;
- sector-specific codes that apply to regulated sectors;
- a multi-regulator framework; and
- dispute resolution mechanisms.
Who are regulated entities?
While the SPF establishes a framework to introduce mandatory requirements to combat scams in all sectors in the economy, the Government has committed to initially designate telecommunication providers, banks and digital platform services relating to social media, paid search engine advertising and direct messaging. Future sectors will be considered as scam methods and trends adapt, and the SPF matures.
The Government’s intention is that the Australian Financial Complaints Authority (AFCA) will operate the single EDR scheme for the first three designated sectors.
Penalties of up to $50 million will apply for non‑compliance under the CCA.
The SPF principles
The SPF principles will apply to all regulated entities. These principles will be enforced by the ACCC as the SPF general regulator under the CCA. The SPF principles relate to:
- governance arrangements relating to scams;
- preventing scams;
- detecting scams;
- reporting scams;
- disrupting scams; and
- responding to scams.
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Author: David Jacobson
Principal, Bright Corporate Law
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About David Jacobson
The information contained in this article is not legal advice. It is not to be relied upon as a full statement of the law. You should seek professional advice for your specific needs and circumstances before acting or relying on any of the content.
