HSBC fought customers 'tooth and nail' over scam but now it's fronting court

Global bank HSBC is set to face a Federal Court hearing where it is expected to admit it failed to protect customers from a widespread spoofing scam. Fraudsters used text messages to impersonate the bank, tricking hundreds of Australians into believing their accounts were compromised and leading to significant financial losses over four years.

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They just kept putting the blame on the victims. It's about time that they admit to their fault … and their system failure.

The Australian Securities and Investments Commission (ASIC) sued HSBC in 2024, alleging "widespread and systemic" failures in its processes to detect and prevent scam losses. Customers reported 950 instances of the scam, with alleged losses totaling $23 million between January 2020 and August 2024. The lawsuit is the first of its kind in Australia aiming to hold a bank accountable for such alleged deficiencies.

Victims, like Sunni Wan who lost nearly $50,000, have formed support groups to fight for reimbursement. Wan stated, "They just kept putting the blame on the victims." She added, "It's about time that they admit to their fault … and their system failure."

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HSBC has fought tooth and nail, fought against its customers, fought against the regulator. These scam victims were gaslit by their own bank.

HSBC had initially planned to contest the case but abandoned its defense, agreeing to a statement of agreed facts. Stephanie Tonkin, CEO of the Consumer Action Law Centre, described the bank's turnaround as "stunning," noting that "HSBC has fought tooth and nail, fought against its customers, fought against the regulator." She believes the bank's conduct was "entirely unacceptable" and is urging the court to impose a penalty in the "hundreds of millions of dollars" to send a strong message.

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HSBC needs to be shown that its conduct is entirely unacceptable and can never happen again. So, a penalty in the hundreds of millions of dollars.