The Lenovo owned company Medion Australia has been fined $259,440 for failing to comply with customer identification rules, resulting in nine known cases of people having their SIMs swapped illegally, five of whom suffered financial losses totalling over $160,000 due to SIM-swap scams.

After an investigation by the Australian Communications and Media Authority (ACMA), it was discovered telecommunications company Medion unsuccessfully completed the required customer verification check for over 1600 SIM-swap requests and one password reset request.

According to ACMA chair Nerida O’Loughlin, the check procedures had been successful in lowering instances of SIM-swap fraud, which made Medion’s noncompliance stick out like a red thumb.

“SIM-swap fraud can cause significant harm as scammers may then be able to gain access to your online banking accounts and other personal information. In this case, criminals have taken advantage of Medion’s compliance failures,” she said.

“The rules have now been in place for well over 12 months, so telcos have had more than enough time to ensure they have robust verification processes.”

The ACMA has allowed a broad two-year court-enforceable undertaking from Medion that will require the company to assign an independent consultant to assess its compliance with the customer ID rules and to make amendments as needed.

SIM-swap scams strike if a con artist takes over a individual’s mobile number by manipulating the person’s information to ask for a new SIM.

When these types of scams began to rise in 2022, new industry guidelines requiring telcos to ensure they have a multi-factor identity authentication check before performing user requests such as SIM-swaps, adjustments to accounts or the revealed an individual’s private data.

The ACMA guidelines will continue to evolve as fraud schemes change, which has led to the Australian government is accessing on its Scams Code Framework. The current guidelines advise on new, required industry codes for the telcos, banks and digital platforms.