“I take the subject of payment fraud very seriously, because it also affects the reputation of our financial centre, and I understand clients’ frustration,” declared finance minister Gilles Roth on Thursday following the committee meeting. The discussion focused on a motion submitted by LSAP MP Ben Polidori on the topic of scams and fraud.
At the end of November a European plan for new regulations was agreed, which should become applicable over the next two to three months. Roth explained what would change:
“At legislative level this means there is an obligation so the customer benefits from compensation, a reversal of the burden of proof so the bank has to say if a customer has acted with gross negligence, and thirdly, that the client is legally obliged to report any fraud on their account to the bank and directly to the police.”
It remains important to keep a healthy balance between the bank’s responsibility and that of the client. The client has an obligation to act cautiously, but banks should act preventatively as well.
“That means when they are made aware of suspicious transactions they must immediately stop them. As the bank must check itself whether the account holder matches the account number, and even with large transactions there needn’t be a direct transfer, instead there could be a delay which would also allow the customer to retract the payment.”
Financial crime knows no borders, Roth continued, and said he welcomed the Europe-wide uniform regulations introduced by the new legislation, as they would be an advantage for Luxembourg:
“We’re a small country and a lot of banking operations don’t just focus on Luxembourg, they operate across borders, so we would benefit from a European regulation applied to all countries.”
Banking scams are usually run by professional criminals, so it remains vital to keep customers informed over all new types of scam. Roth did not rule out running government campaigns on these in the future.
“These campaigns must be done regularly. And as these are professionals at work, I say we must counter them in a professional manner. If we run campaigns funded by public money, I would say that is a good investment in our financial centre, in establishing and maintaining trust between customers and the banks.”
While it is difficult to stop scams entirely, the finance minister said authorities would do everything within their power to keep levels as low as possible.
