National Australia Bank Says Enough Is Enough With Crypto Scams

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The National Australia Bank (NAB) is implementing measures to protect customers from cryptocurrency scams, including blocking certain crypto platforms, as part of its bank-wide scam strategy.

NAB Joins Australian Banks Against Crypto Fraud

Fraud in the crypto industry has become one of the biggest threats to global financial security.

According to statistics by NAB, Australians lost more than $221 million to crypto scams in 2022. Additionally, over the last 30 days, crypto scams have accounted for close to 50% of scam funds reported to the Australian Financial Crimes Exchange.

To protect its customers and residents, Australia has been boycotting transactions to cryptocurrency exchanges through its banks. The crackdown, which has seen the participation of banks such as Westpac and the Commonwealth Bank, has resulted in the blocking of transactions amounting to millions to exchanges.

NAB has become the most recent to join the movement when it announced new customer protection strategies. The bank has stated that it will be blocking some payments made to high-risk crypto exchanges as a move to curb scams.

For the past four months, the NAB has been halting transactions which seemed susceptible to scams. According to the bank’s Analysis, it  intercepted more than $270 million worth of customer payments during this period.

Additionally, NAB stated that when customers received a real-time payment prompt in the app, 12% of payments were abandoned.

By working with telecommunication companies to prevent fraudsters from hacking legitimate text message threads and phone numbers, the company reported a 29% decrease in spoofing reports between January and May.

The NAB Executive for Group Investigations and Fraud, Chris Sheehan said:

“Introducing payment prompts, taking action on spoofing, and stopping the use of links in unexpected text messages are among key measures we’ve introduced recently.”

So far, customers have appreciated the extra measures of protection. In fact, 40% of them were ‘extremely willing’  to have slower payment services if it meant they were better protected from scammers, according to NAB.

“We’re now also taking action to block some payments to high-risk cryptocurrency exchanges in a further effort to stop scammers,” Sheehan added.

He stated that the scammers are part of organized, transnational crime groups who are increasingly using crypto platforms to send stolen funds overseas quickly.

NAB did not reveal which cryptocurrency exchanges will be affected by its move. However,  Sheehan stated that their “approach will be consistent with the rest of the industry.”

Reports have revealed that crypto blocks have affected transactions to the Binance crypto exchange. As such, Binance could again be affected by NAB’s crypto move.

Changing Crypto Market Dynamics

While this move by top Australian banks is a source of relief for Aussies, it is a sign of dark times for the Australian crypto industry.

Most smaller Australian exchanges rely on retail banking services to transfer funds between customers. As such, this ongoing crackdown could cripple them as they will likely lose millions of dollars in customer deposits and withdrawals.

The harsh approach of the NAB might push cryptocurrency trading to offshore exchanges outside the purview of regulators. But in the end, the NAB’s actions show that for the crypto business to gain the trust of the Australian market, it must bring the widespread fraud and manipulation to an end.

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