Customer owned banks urged to look beyond training to prevent breaches
Customer Owned Banking Code Compliance Committee
Customer owned banks need to look beyond staff training and strengthen the systems, processes and controls that prevent breaches from recurring, according to the latest data report from the Customer Owned Banking Code Compliance Committee.
The latest data shows an overall improvement in reported breach outcomes. Reported breaches of the Code fell 32% to 2,345 in the 2024–25 reporting year, while the number of affected customers fell 24% to 346,954. The total financial impact of breaches also fell, from $4.6 million to $3.6 million.
Within that overall improvement, however, staff-related breaches remained a significant issue. Customer owned banks attributed 63% of reported breaches to staff-related causes, up from 55% the previous year. Those breaches affected 43,318 customers, up 37%, and resulted in $1.5 million in financial impact, up 12%.
Chair of the Customer Owned Banking Code Compliance Committee Danielle Press said banks needed to look beyond the immediate staff error when determining how to prevent a breach from happening again.
“When a breach is attributed to staff error, customer owned banks need to consider whether their systems, processes or quality assurance also contributed,” Ms Press said.
“Training may be part of the response, but corrective action needs to address the underlying cause and reduce the risk of the breach recurring.”
Customer owned banks reported training alone as the corrective response to 84% of the 1,476 staff-related breaches. Only 2% involved longer-term measures such as system improvements or stronger monitoring and controls.
The report also shows the value of banks identifying problems proactively through internal monitoring, staff escalation, quality assurance and audit.
Proactively identified breaches had an average financial impact of $5.25 per affected customer, compared with $28.70 for breaches identified reactively through a customer complaint, query or external audit.
Ms Press said identifying problems earlier gave banks a better opportunity to address them before customer detriment increased.
“Customers should not have to complain before a bank identifies that something has gone wrong.
“Strong internal monitoring helps banks find problems sooner, fix them sooner and reduce avoidable detriment to customers.”
Privacy remained the most commonly breached area of the Code. While reported privacy breaches fell from 663 to 534, the number of affected customers increased from 6,832 to 40,845.
About us:
The Customer Owned Banking Code Compliance Committee is an independent body that monitors compliance with the Customer Owned Banking Code of Practice. Its purpose is to ensure consistent and high-quality service standards are maintained for the benefit of customers.
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