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LETTER | National Scam Response Centre must be reformed

LETTER | Despite the best efforts of the National Scam Response Centre (NSRC), scams continue to increase, impacting severely the financial, psychological and social well-being of consumers.

In 2023 alone, according to the NSRC, overall losses due to scams totalled RM1.34 billion. In the instance of investment scams, losses more than doubled from RM209 million in 2022 to RM437 million in 2023, an increase of over 109 percent within a year.

Those affected by scams are not only ordinary consumers but also include the professional, the educated and the articulate. Thus clearly, every consumer is a potential victim of a scam.

Recognising that frequently the losses due to scams may not be recovered despite the best efforts, the best protection is certainly self-protection. Once you are a victim the possibility of recovering your losses is slim.

Furthermore, scams are continuously innovating with new forms of scams growing almost every day. The latest being for example involves embedding malware in wedding invitation cards or using the latest government assistance schemes to deceive consumers.

It is hence vital that scam awareness and education programmes be strengthened to make them more effective. A one-size-fits-all strategy may not be effective.

Different forms of scams

Firstly, frequently differing demographics may be exposed to different forms of scams. For example, youths may be more exposed to job scams. Young working adults may be attracted to cryptocurrency scams. Matured adults with savings may attract investment scams.

Thus to ensure effectiveness for each group the right messaging as well as the right medium to deliver must be ascertained. For the younger group, TikTok or YouTube videos may be the appropriate medium of messaging.

In relation to the medium of delivery, for some social media may be an effective platform. For others - the elderly for instance - a face-to-face approach may be more effective. For still others, printed posters and brochures may be the effective medium.

The focus of the education programme is not just on delivering knowledge but helping consumers identify when a scam is being executed and more importantly, changing the behaviour of consumers to adopt proactive behaviour that would protect themselves from scams.

Consumers must be able to identify when a scammer contacts them and adopt the appropriate behaviour to protect themselves.

Consumers must be exposed to the multiple strategies used by scammers to manipulate consumer behaviour. Scammers use multiple emotional manipulation strategies to scam consumers.

Strategies would include fear-based strategies such as impersonating a police officer, income tax officer, or anti-corruption officer. It would also frequently involve urgency or tight deadlines for example getting arrested, being charged under the Money Laundering Act, or major financial loss if not acted upon “immediately”.

It might also involve high returns which the victim must act upon urgently to benefit. Education programmes should enable consumers to identify early when a scammer contacts them.

Secondly, the NSRC must coordinate the efforts of all the regulatory agencies such as the police, Bank Negara Malaysia, the telecommunication service providers, and the Securities Commission to protect consumers as well as react rapidly and efficiently once a scam is reported to ensure the maximum possibility of full recovery of monies lost.

Coordinated efforts

The NSRC may also explore new players to work with to minimise scams. This would include the online selling platforms as well as the social media platforms. These mediums play a major role in the scam process.

Thirdly, when a consumer gets scammed, frequently he bears the full brunt of his losses. Thus even if the banks or telcos did not act responsibly to protect the consumer, the consumer still bears the fullest brunt.

In Singapore and in many jurisdictions, the regulators first examine if the banks had undertaken the fullest security responsibility to protect consumers, next the telco is examined if they had acted responsibly and only then the consumer is held responsible. This is the concept of shared responsibility.

The NSRC’s priority should be to work towards shared responsibility among all the players to ensure that the best efforts have been in place that could have prevented or at least minimised the losses of the consumer.

This is only fair and just to the consumer. The Federation of Malaysian Consumer Associations (Fomca) deeply hopes that shared responsibility will be a priority of a reformed NSRC.

To minimise scams - if complete eradication is not possible - Fomca strongly hopes that the reform of the NSRC would ensure greater efficiency and effectiveness of the agency to protect consumers from falling into scams, and if they do, then all responsible parties must share the responsibility of the losses.

Consumer empowerment is important. But the related agencies especially the banks and the telcos must also take strong measures to protect consumers, failing to do so, they then need also bear some responsibility.

The views expressed here are those of the author/contributor and do not necessarily represent the views of Malaysiakini.

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