Hundreds caught in BPay fraud

Around 100 BPay customers have had millions of dollars stolen from their bank accounts since February this year, with some people losing up to $150,000 each. New South Wales police have set up a major investigation, Strike Force Windrush, to investigate the fraud scheme, which has exposed major security flaws in Internet and telephone banking.

Strike Force Windrush, set up four weeks ago, has already identified a major organised crime gang as the one rorting BPay and three people have already been arrested. The police are believed to be receiving new reports from the scam victims every day.

The BPay system was introduced by the major banks with the aim of making bill-paying quick and safe. The Australian Bankers' Association says that around 530,000 Australians, or 5 per cent of the population, currently use the Internet to pay bills and transfer funds, and 5.6 million, or 49 per cent, use the telephone for the same functions. The ABA has been quick to reassure bank customers, saying that they will always be reimbursed if it's proved they are victims of outright fraud.

The Australian Consumers' Association said that the onus is on the banks to protect people's money, especially after the banks have been pushing for customers to switch to online banking. There's no excuse for the banks not putting resources into online security, Catherine Wolzhuizen said, particularly in light of the extra fee revenue banks have been obtaining over the past few years.