Introduction
Protecting individuals against the rising threat of scammers has been a key focus of the Government. The Ministry of Home Affairs (“MHA“) has reported that in the first half of 2024, the number of cases of scams has increased by 16.3%, with victims losing a record high of over S$385.6 million.
Of particular concern is the number of scam cases involving the voluntary transfer of monies by the victim to the scammer. Despite the introduction of safeguards and public education efforts, in the first half of 2024, 86% of reported scams were the result of self-effected transfers, with the scammers manipulating the victims into transferring their monies. In some of these cases, the victims refused to heed warnings from the Police, banks, or their families that they were being scammed, including victims of internet love scams and government officials impersonation scams.
To address this area of concern, MHA will be introducing the Protection from Scams Bill (“Bill“) in the coming months. The Bill seeks to empower the Police to issue Restriction Orders (“ROs“) to banks to temporarily restrict the banking transactions of targets of ongoing scams who refuse to believe that they are being scammed. Currently, the Police have no power to stop such targets from transferring their monies if they insist on doing so.
MHA is conducting a public consultation on the proposed Bill from 30 August 2024 to 30 September 2024, seeking feedback and suggestions from the public. This Update sets out the main features of the Bill, including its scope and the relevant processes.
Features of the Bill
What types of scams are covered? – The Bill will only cover scams that are conducted via digital or telecommunication channels (calls, SMSes, or online communications etc.), where there have not been any in-person interactions.
What does an RO do? – ROs may cover the following scope of banking facilities:
- Suspension of money transfers from the victim’s bank accounts. Individuals will still be able to apply to the Police to have access to their monies for legitimate purposes (daily living expenses, bills etc.).
- Suspension of all credit facilities (including credit card transactions, personal loan facilities). This is intended to guard against the risk of scammers deceiving victims into applying for credit lines or loans on the scammers’ behalf.
- Application across banks. When the Police determine that an RO should be issued with regard to an individual, individual, the RO will be issued to all the seven Domestic Systematically Important Banks in Singapore.
How long is an RO valid? – ROs will be issued for a period of 28 days in the first instance. After that, if the Police assess that the individual is still at risk of being scammed, they will renew the RO for up to 28 days at a time.
When will an RO be issued? – ROs will only be issued if the Police have reason to believe that the individual is being targeted by a scammer and may make transfers to the scammer within the foreseeable future, and after other options to convince the victim have been exhausted. The decision to issue a RO will be made by the Police, based on its assessment of the facts and circumstances of each case including how strong the evidence is that the individual is being targeted by a scammer, how imminent the scam is, how the individual has responded to warnings of the scam, and whether the individual has been previously scammed.
Can an RO be disputed? – Individuals will be allowed to appeal to the Minister for Home Affairs against the Police’s decision to issue the RO. The decision of the Minister for Home Affairs is final.
Concluding Words
The Bill introduces a vital tool in the fight against scams, providing the Police with a wider scope of authority to intervene in situations where an individual is about to fall victim to a scam despite best efforts to warn such individual. The Bill also imposes obligations on banks to heed Police orders to restrict the transactions of scam targets. This is potentially significant to the operations of banks and financial institutions, and to the interests of individuals, particularly those in more vulnerable demographics.
Interested stakeholders should respond to MHA to provide feedback on the proposed Bill, particularly on operational or practical issues that may arise, and on any clarifications they have regarding the details of the proposed framework. In particular, MHA has sought feedback on whether the proposed scope of the ROs is appropriate and whether any exception should be made for individuals issued with ROs to be allowed some access to money. Parties wishing to provide feedback may wish to contact our team for further guidance.
Disclaimer
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