Public Bank introduces cooling-off period for abnormal transactions to fight scammers

PETALING JAYA: Public Bank Bhd has introduced a 12-hour cooling off transfer period from Thursday (June 22) to be proactive in dealing with scammers who use bank transfers to cheat unsuspecting victims of their savings.

In a statement to its customers, Public Bank said it was introducing a 12-hour transaction cooling-off period for abnormal transfers.

A transaction cooling-off period is a precautionary measure that allows banks to review and assess certain transactions that display characteristics of abnormal behaviour.

This additional step was proposed by Bank Negara Malaysia and banks worldwide, designed to minimise the risk of unauthorised transactions and potential fraudulent activities, ensuring the safety of customers’ funds.

“As an added security feature to protect your financial interests, the bank will be introducing a transaction cooling-off period for abnormal transfers from June 22, 2023,” it said.

It explained that when the bank detects any transaction deemed abnormal, the transaction will go through a cooling-off period.

“This is an added security measure to protect your financial accounts which allows us to review and assess certain transactions that display characteristics of abnormal behaviour.

“The bank will notify you of the status of your transaction via SMS, email and push notification.

“Alternatively, you may track your transactions by logging into PBe, click ‘Account’ and select ‘View Pending Verification’.

“Any transaction that is undergoing the transaction cooling-off period will be listed here.

“While we cannot disclose specific criteria of indicators for identifying abnormal transactions to maintain security protocols, our advanced monitoring systems leverage a combination of sophisticated algorithms and industry best practices to detect potentially suspicious activities.

“Rest assured, our dedicated team continuously works to refine these systems to improve accuracy and minimise any inconvenience caused to our valued customers,” Public Bank said in its frequently-asked-questions (FAQs) section.

On June 11, Bank Negara, in an email to The Star, said that generally, most banks have adopted a cooling-off period of between 12 and 48 hours, depending on the type of transaction or banking activity.

“In September 2022, Bank Negara announced five countermeasures to strengthen online banking security, which includes requirements for banks to migrate from SMS OTP to more secure forms of authentication; tighten detection rules and triggers to detect and block suspicious transactions; implement a cooling-off period for first-time enrolment of online banking services and secure devices; limit the number of registered devices that can be used for authenticating transactions; and establish dedicated scam hotlines for victims to contact the banks to report scam incidents promptly.

“Other measures include a kill switch for victims to freeze their banking accounts temporarily to stop further loss of funds.

“As fraud patterns differ between banks, each bank must ensure that the countermeasures are commensurate with the level of risk observed.

“Hence, banks will apply an appropriate cooling-off period that effectively deters fraud whilst maintaining a reasonable customer experience without excessive friction.

“In addition, public awareness remains important in preventing online banking fraud,” said Bank Negara.

On May 2, in The Star’s front-page titled “Fighting chance to beat scammers”, cybersecurity law expert and lawyer Derek John Fernandez mooted the idea of adopting a 48-hour “cooling period” when money above a threshold is transferred to new bank accounts.

This, he said, might give scam victims enough time to pull their money back from the brink before it reaches the greasy hands of scammers.

Fernandez said that this was one of the ways authorities and financial institutions can stop a financial scam as victims usually realise they have been scammed after 24 hours.

He opined that another 24 hours was needed to stop the money from being transferred to the scammer.

Fernandez had proposed a 48-hour cooling-off period to the government including Bank Negara and the Malaysian Communications and Multimedia Commission (MCMC) on what the authorities can do to protect consumers from financial scams, adding that MCMC is authorised to do so under the MCMC Act 1998.

“During the cooling-off period, if the new bank accounts seem suspicious or if the bank has received complaints from other consumers, these accounts can be tracked down by MCMC and further action can be taken such as blacklisting the bank account.

“If consumers suspect the money transfer they initiated is to a scammer, they can cancel immediately. MCMC can then publish these account numbers to its website to alert others of the blacklisted accounts and scammers,” added Fernandez in his 75-paged proposal to Bank Negara and MCMC last year.

On May 12, MCMC chairman Tan Sri Mohamad Salim Fateh Din said that statistics obtained from the police Commercial Crime Investigation Department for the period between 2021 and April 2023 revealed losses as a result of scams amounted to RM1.2bil.

Source: The Star


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