A recent case, investigated by dispute resolution service, Financial Services Complaints Limited (FSCL) has highlighted
the need for financial institutions to do more to assist vulnerable consumers, after a disabled consumer’s caregiver
stole over $10,000 from her bank account.
“Vulnerable consumers often require a higher level of assistance from the financial institutions they deal with because
they can have greater needs, so extra effort and care on the part of financial institutions will often be necessary,”
explains FSCL Chief Executive Officer, Susan Taylor, adding that fair conduct obligations on non-bank deposit takers are
likely to increase in the near future, with the development of the Conduct of Financial Institutions legislative
“This means the obligations on financial institutions in relation to their treatment of vulnerable consumers are likely
to increase. It may be worthwhile reviewing policies and procedures now to see where services may be able to be
In the recently published case note, FSCL explains how Aesha, who does her banking with a credit union, received
assistance with her finances from a local charity group.
For Aesha’s safety, there needed to be a ‘two- to- sign’ process where a senior employee at the charity would sign a
withdrawal slip and Aesha would counter sign at the branch, in front of a teller, to get her money.
However, her caregiver, who went with her to the branch to take the money out, not only altered the withdrawal slips
before going to the branch with Aesha, but also used fraudulent transfer slips to move Aesha’s money into a separate
account, which then allowed the caregiver to withdraw money from an ATM, using Aesha’s EFTPOS card.
It was when a teller noticed that the withdrawal slip had been altered that the credit union let senior staff at the
charity know that something was amiss.
After the offending had been discovered and the matter referred to the police, the charity brought a complaint to FSCL,
as they believed that the credit union should have done more to prevent the fraudulent withdrawals.
They argued it was clear the withdrawal slips had been altered, that there should have been a $100 withdrawal limit on
Aesha’s account and the transfers to the ATM account were not authorised at all.
The credit union did not believe that they were in any way liable, that Aesha signing the withdrawal slip in front of
the teller was sufficient and that the charity, or Aesha’s family, should have picked up the large withdrawals on
regular bank statements.
They argued that FSCL should not investigate because the caregiver may be ordered to reimburse Aesha as part of the
Having reviewed both sides of the argument FSCL found that although the charity had not explicitly asked for a credit
limit to be put on the amount that could be withdrawn, the credit union had relaxed the ‘two-to-sign’ measure by
allowing the withdrawal slip to be signed by one signatory off-site. This had contributed to fraud being able to take
FSCL also considered that the credit union’s staff should have noticed the withdrawal slips that had been obviously
altered and that the number of ATM withdrawals, unusual for Aesha who had not used ATMs previously, had spiked.
Taking into this account, FSCL asked the credit union to reimburse 40% of the amount stolen and both parties agreed.
“FSCL has a focus on supporting vulnerable consumers and for this reason we have updated our vulnerable consumer policy.
This includes mechanisms to prioritise those complaints that have vulnerability factors. Our translation service is
available to help those for whom language may be a barrier and we are ensuring that we connect with community
organisations, so that people are aware of our services,” says Ms Taylor.