How to keep yourself safe against rising mobile fraud


Published on

Thanks to technology, our mobile devices now do so much more than just connect calls.

There are about 1.7 billion smartphones in use around the world and last year consumers spent $US325 billion ($438 billion) in mobile transactions.

The mobile phone has in many ways replaced the wallet, and by the end of 2017 we're expected to be using it even more.

mobile fraud

There are five methods of mobile payment: - Mobile at point of sale, where the device uses a near field communication (NFC) chip to wirelessly connect to your bank account; - Mobile as point of sale, where you can directly accept mobile payments from credit cards on your device; - Mobile payment platforms, which are digital wallets like PayPal; - Direct carrier billing, which involves borrowing credit from your ISP to make a payment; and - Closed-loop/open-loop payments, which are things like retail credit accounts (closed) and ApplePay (open).

According to Fair Go Finance, 30% of Australians plan to use their smartphone for all of their financial needs by 2017. At the moment, 17% use their phones to make payments in a store.

Data from the CUA credit union shows that we're more likely to use our smartphones to pay for groceries or takeaway meals, spending an average of $27 per transaction.

But while mobile wallets increase in popularity, so too does the risk of fraud. In the US, LexisNexis, a research and risk management company, reported a 33% increase in fraud among merchants in 2014, and this figure is only set to rise with the growth of mobile banking.

For every dollar of mobile fraud, LexisNexis estimates the consumer cops $US3.34 ($4.50) in hidden costs. For users of Apple Pay, the fraud rate is about 6%, or $US6 in every $US100 spent.

Mobile fraud can be easy to prevent if you take precautions. The Australian Competition and Consumer Commission's ScamWatch website recommends taking a proactive approach to your mobile security, and treating your phone as you would your personal bank account.


If you don't have a PIN or passcode on your phone, you should organise one now. Don't pick a PIN that's common to multiple accounts or devices, and be sure to change it every so often. If your mobile banking includes secret questions, don't make them too obvious - scammers can access your social media accounts to find out all about you.


Only open attachments from familiar email addresses. You should also be on the alert for phishing scams, which is when you're sent a text message from an unknown number asking for your bank account details. Basically, if you don't recognise the sender's mobile number or email address, it's probably a scam.


Some apps might not be as safe as you think they are. Avoid downloading apps that aren't from the official iTunes or Google Play stores - you could be downloading a bug.

Misplaced phone

If you lose your phone or have it stolen, you should notify your bank as soon as possible. You can then organise to have your passwords changed. It's also worthwhile notifying your service provider, which can then block your phone from receiving service. If you're paranoid about losing your device, it might be a good idea to download a mobile phone tracking app.

Get stories like this in our newsletters.

Related Stories


Steph Nash was a staff writer at Money until 2017.