NZ left off Google's global anti-scam plan while victims lose millions

Tuesday, 20 June 2023

Financial criminals are placing their adverts through Google to lure unsuspecting victims to their fake investment sites.

Technology giant Google is rolling out anti-scam advertising scheme around the world, but appears to have no immediate plans to include New Zealand.

New Zealand has been subjected to a wave of financial crime, with an ongoing scam involving overseas criminals advertising a fake service to “compare term deposits” through Google sponsored adverts that appear at the top of search results.

The scam prompted the Financial Markets Authority (FMA) Te Mana Tātai Hokohoko to urge people exercise “extreme caution” when it came to who they trusted their money to.

The fake website does not show any term deposit comparisons, but is designed to lure unsuspecting investors to fill in their details, which is a prelude to them being phoned, and scammed out of their money.

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But while the crook’s advert can appear at the top of Google search results in New Zealand, there is a good chance it will be blocked in many countries as a result of Google’s “financial verification” scheme.

In these countries, including Australia, Google will not accept adverts for financial services from anyone who can’t show they are regulated to provide that service.

Advertisers are required to identify themselves, and provide information including the financial services they are regulated to provide, and their registration numbers.

In August, Australia was covered by the verification service, as was Singapore and Taiwan.

They had followed the United Kingdom in September 2021.

And in January, Google extended the scheme to Brazil, France, Germany, India, Indonesia, Portugal and Spain.

The FMA has been trying to get Google to extend the verification scheme to New Zealand, but appears to be frustrated with progress.

“We have been trying to work with Google on the expansion of its financial advertisement verification programme into New Zealand,” an FMA spokesperson said.

A Google spokesperson was not able to give a target date for when, if ever, it would extend the anti-scam advertising protection to New Zealand.

“We are working to expand our financial services verification program and will be adding additional countries to the program in the future,” the spokesperson said.

Google’s spokesperson said the company was “committed to combating financial fraud in ads and protecting our users and advertisers from scammers”.

“Financial scams is a complex space and the tactics bad actors are using are rapidly evolving,” she said.

“We actively look for ways to ensure a safe user experience for those interacting with ads on Google. We first launched this policy in the UK, and have since been working to scale these tools so that they can be leveraged around the world,” she said.

“We hope to bring this policy to New Zealand in the near future, but in the meantime have encouraged the FMA to escalate any suspicious ads to us for review,” she said.

“Creating policies in these areas takes time, from developing and testing these features to engaging with third party groups and government regulators to ensure our policies can be effectively applied locally,” she said.

Globally, Google is being used by the likes of criminals and sharp operators to disseminate billions of dodgy adverts.

“To give you some context of the scale of the issue, last year, our team blocked, or removed over 5.2 billion ads for violating our policies, of which 198 million ads were for financial services,” the spokeswoman said.

Cert NZ warned of a significant investment scam which conned New Zealanders out of millions of dollars in February.

The losses faced by people in New Zealand from scams has been rising, but the true scale remains unknown, with cybercrime being the second least-reported crime, behind only sexual assault.

Rob Pope, director of government anti-scam agency Cert NZ said the number of people reporting scams rose in the first quarter of this year.

Reports were up 12% from last quarter, and financial losses were up 66% to almost $6 million, he said.

Fake investment scammers finding their victims through internet adverts was contributing to the rising tide of losses.

“Cyber criminals are using search engine ads and professional-looking documentation to scam New Zealanders looking to invest money. One scam campaign in February cost New Zealanders millions of dollars in a very short time, which reflects how quickly someone can lose their assets if they’re not alert,” Pope said.

That campaign was the fake term deposit comparison website “where someone searching terms such as 'term deposit comparison nz' on Google would be shown a search page that included ads paid for by scammers and linked to fake websites”, Pope said.

“People who sent details to these sites were called by the scammers, claiming to be from the investment team at a New Zealand-based financial institution. These people were given professional-looking fake prospectus documents and details on how to transfer money to be ‘invested’.”

Cert NZ’s first quarter cyber security insight report said Cert NZ and Google had worked closely to have malicious URLs removed.

In June last year, the Australian Competition and Consumer Commission (Asic)said the regulator had worked “constructively” with Google on blocking scam adverts.

“Asic certainly welcomes Google’s initiative, and we thank Google for their constructive engagement with Asic on the issues involving the digital advertising of financial products,” an Asic spokesperson said.

Pressure in Australia had been building to regulate tech giants like Google.