ACMA compliance priorities for telco customers
Thank you, Andrew – and it is great to be here today. Congratulations to ACCAN on what I think will be a fantastic conference with an important theme – achieving better basics for all from communications services.
I acknowledge the traditional owners of the land on which we meet today. I am on the land of the Gadigal people of the Eora nation, and I pay my respects to elders past, present and emerging. I extend that respect to First Nations people joining this conference today.
As Andrew mentioned, today I will give you an update on what the ACMA is doing, and intends to do, to help achieve the outcome embodied in the conference theme for this year. I will:
- Give you an update on our compliance priorities for 2022–23.
- Drill into a couple of those priorities, which I hope will be of most interest to you.
- Touch on the upcoming review by Comms Alliance on the primary code of practice for consumers.
This is the fourth year that we have announced our compliance priorities. These are developed from our own data and experiences, and through a public consultation process.
Our compliance priorities for 2022–23 target issues that have the potential to cause considerable financial and social harm to the Australian community. This year our priorities are:
- supporting Australians to self-exclude from online and phone gambling
- protecting telco customers experiencing financial hardship
- enforcing SMS and email unsubscribe rules
- combating SMS and identity theft phone scams
- tackling online supply of dodgy devices
- improving quality captioning
- combating misinformation and disinformation on digital platforms.
For communications services, this means the ACMA will be continuing its fight against scammers through enforcing new rules that require telcos to use stronger ID checks for transactions targeted by scammers, and reducing SMS scams. We will be helping telco consumers maintain access to essential telco services by making sure telcos comply with their financial hardship obligations.
I will touch on each of these briefly.
Since 2018, we have been pushing the telco sector hard to improve its safeguards against – and performance in addressing – phone and SMS scams.
We know the potentially devastating impact that scams can have on Australians – from losing money, through to losing control of their own identities.
We’ve introduced rules requiring telcos to block scam calls and use multi-factor ID to prevent mobile number porting fraud. We’ve also recently registered new rules requiring telcos to identify, trace and block SMS scams. And we have made new rules requiring telcos to use enhanced ID checks to prevent SIM-swap scams and other fraud.
We expect these rules to have a real impact in preventing scams.
Since the previous rules came into effect, telcos have blocked over 660 million scam calls. We have also seen a significant drop in consumer complaints about scam calls —a 50% reduction to the Scamwatch service and a 70% reduction to the ACMA. Reports about mobile porting fraud have also dropped dramatically – by approximately 95%.
We will be closely monitoring the effectiveness of the new rules and expect to take strong action where we find non-compliance that exposes consumers to harm.
We have already acted where mobile telco Circles failed to properly implement mobile porting safeguards – at least 42 people had their numbers stolen and at least 7 suffered financial losses. Circles paid a $200,000 infringement notice and offered compensation to victims of over $100,000.
Due to the way scammers operate, there is no ‘silver bullet’ to address the problem. However, if government, industry and consumers all play a part, we can make Australia a hard target for fraudsters. And every scam prevented is a win for consumers.
The phone and SMS scam rules also require telcos to provide information to their customers to raise awareness about scams and what consumers can do to protect themselves.
We are also focused on educating consumers through:
- Developing resources in 5 languages, including some specifically developed for First Nations Australians, to help consumers spot and take action to stop phone scams. (These resources are in your delegate bag and can also be found on our website.)
- Conducting online and social media campaigns to raise awareness about scams and promote the resources.
- Regularly issuing scam alerts to consumers, mainly via online and social media channels. Recent alerts include warnings about the increasingly sophisticated technical support/remote access scams, and the text/WhatsApp scams known as ‘Hi Mum’, where scammers pretend to be a relative needing help.
Scams target everyone, and everyone can fall victim – however, our research indicates older Australians are less likely to use technological solutions to help protect themselves. Accordingly, part of our focus has been on reaching older Australians.
Protecting those in financial hardship
Our second compliance priority I would like to highlight is on protecting telco customers experiencing financial hardship.
The ACMA recognises telecommunications as an essential service and that there can be challenges in accessing these services, especially for consumers in vulnerable circumstances.
There are consumer safeguards and protections, including Australian consumer law and the telco-specific Telecommunications Consumer Protections Code (TCP Code).
However, data shows several areas of concern, particularly for consumers experiencing vulnerability, which can impact service accessibility. For example:
- The ACMA’s 2020–21 financial hardship state of play report found that 242,246 telco residential customers had their services disconnected due to non-payment or the customer being uncontactable. Of these, less than 1% (1,373 or 0.6%) were financial hardship customers.
- This raises questions around why such large numbers of disconnections occurred outside financial hardship arrangements, including whether customers were aware of the availability of telco financial hardship arrangements.
- The TIO’s July 2022 systemic investigation report into complaints about essential mobile services, which identified mis-selling, poor service reliability information, customer self-service accessibility and automatic payment methods as the key drivers for complaints about mobiles.
It is important for telcos to understand that there is always scope for them to go beyond the basics. Offering more to consumers beyond the minimum mandated levels in areas such as customer service and complaint- handling can provide industry with another area in which to compete.
With the effects of the pandemic, impacts of natural disasters and the rising cost-of-living many Australians are struggling with financial pressures, including meeting the costs of essential services.
This is likely to lead to an increased number of telco customers who will experience financial hardship and need support from their telco to maintain access to this essential service.
Our focus will be on:
- conducting research to understand the telco consumer experience
- making sure telcos comply with their TCP Code obligations around credit management and the disconnection of services
- compliance with, and education about, the rules for the visibility and effectiveness of financial hardship policies.
Intelligence gathered through these activities will also inform the ACMA’s upcoming review of the TCP Code.
We also released a Statement of Expectations for telcos dealing with vulnerable consumers in May this year. The statement covers all aspects of customer interaction, from selling practices and customer service, to the provision of financial hardship support.
The goal of the statement is to improve outcomes for consumers in vulnerable circumstances who may be experiencing barriers accessing or maintaining their access to telco products and services.
The statement is not a compliance document. Instead, it offers advice to industry on providing support to consumers experiencing vulnerability in ways that go beyond the basics set out in the TCP Code.
TCP Code review
Finally, and while we are on the TCP Code, a reminder that the code is due to be reviewed by 1 July 2024.
The TCP Code provides a range of consumer safeguards in the areas of advertising and sales, contracts, customer service, billing, credit and debt management, financial hardship and changing providers.
Planning for the ACMA’s TCP Code review work is underway. While the TCP Code review is industry-led, we think it is important to engage with the process early.
We are looking to establish clear expectations at the outset for what the key issues are, including whether the code is working effectively or if other interventions may be necessary to ensure basic consumer protection needs are being met.
For a code to be effective it must be measurable, transparent, responsive to consumer needs and reflect genuine consultation.
We will be using this our complaints-handling data, survey results and research, as well as insights from the TIO, consumer groups and other regulators to inform our interactions with industry on this important consumer code.
Today, I have just highlighted a small number of activities we are undertaking to help achieve better basics for telco consumers. Thank you to ACCAN for the opportunity to speak to you today, and I am happy to take any questions.