NZ phone companies and the government are setting up a system that will identify scam callers within hours and, they hope, stop them in their tracks, the Spinoff can reveal.

We’ve all received them. The calls from strange corners of the world at odd times of the day. After I made the mistake of answering one from the peddlers of a dodgy share scheme the calls just kept on coming. In the following weeks I blocked a seemingly endless stream of different numbers from the UK and Canada, and by the time the scammers were done with me I had blocked nearly 40 numbers.

The BNZ warns it has seen a 54% increase in the number of people falling victim to scammers in the past year. It often starts with a cold call, with the number one racket the bank grapples with being the Spark Scam: fraudsters call posing as tech support and convince people they need access to their computers to fix issues such as viruses.

“These guys are relentless,” head of financial crime Ashley Kai Fong said. “They are calling people several times a day and sometimes, simply by wearing their victims down, are managing to get access to people’s computers or passwords and stealing money.”

As those in the scam busting sector mark International Fraud Awareness Week, local telcos and the government are joining forces to create a system for stymying the scammers. Industry body the New Zealand Telecommunications Forum (TCF), Netsafe, Cert NZ and the Inland Revenue Department are announcing a memorandum of understanding (MOU) which will allow them to more quickly identify scam callers and shut them down.

The problem is there’s no single point for reporting scam calls. People might tell their phone provider, or they might inform various agencies. But until now there has been no way to pass that information through to the industry easily, TCF chief executive Geoff Thorn said. The telcos may see patterns of what appears to be scam activity, but they have no idea of the content until someone reports it. 

“Basically we’re looking for the number called, the number that called it, what time it happened, and some sort of verification that it was a scam call so someone can make the judgement. We’re now working with a range of government agencies to allow them to report that through to the industry as they receive information from consumers,” he said.

It will allow the industry to take action within hours, and therefore reduce the chances of New Zealanders hearing from these unwanted callers, Thorn said. “It really is whack-a-mole. As soon as we block a number, another number pops up. But if we don’t know about the numbers there’s nothing we can do about it, and that’s the issue. If we can make it harder, there will be less of them. That’s the theory.”

The Commission for Financial Capability (CFFC) says scams are on the rise and no-one is immune. To help highlight the problem it has made the documentary Fraud Hurts in conjunction with the Serious Fraud Office.

Cold calls offering investment advice are illegal in New Zealand, yet many people are unaware of this, the CFFC says. The film tells the story of Greg*, who thought the caller offering the chance to get into an offshore investment sounded convincing. He initially made two payments of $5000 or $6000. “This chap said ‘you’ve done well here’, he sent me a statement showing the growth pattern.”

But before long Greg felt trapped. The scheme “managers” began threatening that if he did not make another deposit they wouldn’t be able to get the scheme across the line. “I had already made a significant investment at this stage, but (I was) still thinking that this was not beyond recovery.” Finally Greg lost patience and told them what he thought, and suddenly the calls stopped coming. He had been scammed for over $200,000. “How could I be the fool to fall for this?” 

The telcos have been making efforts to stem the flow of such calls, and last year a group including Vodafone, 2degrees and Spark set up the Scam Calling Prevention Code. The code creates a consistent approach to identifying, verifying and blocking fraudulent calls while minimising the impact on legitimate traffic. The telcos share numbers that have been verified as scams so that they can each block them.

The new MOU expands this to include government agencies and other service providers, Vodafone said. “They can report scam information from their customers directly to network operators using the code’s process,” said a spokesperson.

Spark said it’s not possible to eliminate the problem completely, and so it focuses on educating its customers to be vigilant as well. It maintains a scam alert webpage, puts out a scam call brochure in both English and Mandarin in partnership with Netsafe, and posts alerts on Facebook about major spikes in certain types of scams.

Spark is also now selling a new home phone called Call Screen. The CFFC conducted a trial of the landline product last year which showed that of all the calls received, around 30% were nuisance or scam calls. The device blocked 98% of these calls.

*Name has been changed.

Jenée Tibshraeny of interest.co.nz surveys the issues that have farmers worried right now, and looks at the facts behind the fears.

Rumblings from the dairy farming sector are becoming increasingly loud, as both the Government and Reserve Bank (RBNZ) make policy changes that affect the sector.

New Zealand has for years milked its white gold for all it’s worth – milk powder, butter and cheese comprising about a quarter of the country’s merchandise exports by value. But the effects of a period of intensification on both the environment and banks’ risk profiles have come to a head.

Regulators are making changes, and naturally, many of those affected aren’t happy.

However, with National and NZ First becoming more aggressive in their battle for the rural vote as Election 2020 approaches, and the powerful agricultural and banking lobbies joining forces against the RBNZ in relation to its proposed bank capital rules, the space is getting very noisy.

It’s increasingly difficult to differentiate between valid problems and pure resistance to change.

In an attempt to address some of the concerns being aired, interest.co.nz has summarised the major policy changes underway and provided context around them. We have simply detailed some of the facts and will leave you to draw your own conclusions.

The concern

‘Farmers will bear the brunt of the looming credit crunch.’

The policy

Retail banks will most likely be required to hold substantially more capital further to a RBNZ review. If the outcome, to be announced on December 5, prompts banks to restrict their lending, dairy farmers are likely to be among their higher risk borrowers affected.

The context

Banks have in recent years been reducing their exposures to the dairy sector, having lent up a storm in the past. However it’s difficult to know the extent to which the pullback is being driven by looming capital rule changes.

The value of dairy loans as a portion of total bank lending (household, business and agriculture) has fallen to 8.8%, from about 10% in September 2016, according to Reserve Bank data. Unfortunately, the data set doesn’t go back further in time.

As of September dairy debt stood at $41.249 billion, comprising the bulk of total agriculture debt of $63.867 billion. However, dairy lending growth was near-stagnant as at March 2019, and has been drifting lower this year from $41.719 billion in January.

RBNZ Governor Adrian Orr last Wednesday said the areas where banks over are overexposed to dairy are narrow, yet deep. He said some farmers would “struggle at current levels”. Global dairy prices are perky and the low New Zealand dollar is making New Zealand exports attractive on the world stage.

In September Orr said that over the previous 12 months, as the RBNZ had been working with stakeholders on its capital proposals, it had reduced the Official Cash Rate by more than the banks’ estimated costs of the higher capital requirements. Yet some sectors of the economy such as agriculture had seen their borrowing costs rise. This, Orr suggested, could only happen if banks were “significantly raising” their margins.

The concern

‘Too much productive farmland is being converted to forestry.’

The policy

In October 2018 the government introduced a special test to provide a streamlined consent pathway for overseas investment in New Zealand’s forestry industry. The rule change aligns with NZ First’s One Billion Trees Programme. The government is stumping up $240 million to encourage more tree planting and the goal is for the current planting rate to double, so that a billion trees are planted by 2028.

The context

Between 2002 and 2006, the amount of land converted to dairy increased in every region in New Zealand, except for Taranaki. In Canterbury it increased by 155% and Southland 158%, as per this Stats NZ graph.

Of the 27 consents (covering 73,200 hectares) the Overseas Investment Office issued to overseas forestry investors between October 2018 and September 2019, 12 consents (covering 14,300 ha) will include some farmland being converted to forestry. A hectare is about the size of a rugby field.

The government also announced in October 2019 that overseas-owned Pan Pac had received pre-approval to make forestry-related purchases of up to 20,000 ha, including conversion of land from farming to forestry.

The concern

‘Cows will need to be culled for NZ to meet its emissions targets.’

The policy

Targets of reducing biogenic methane emissions to 10% below 2017 levels by 2030, and between 24% and 47% below 2017 levels by 2050, have been legislated under the Zero Carbon Act.

The context

According to modelling done in 2018 by the Biological Emissions Reference Group, which includes New Zealand agricultural and government representatives, widespread adoption of currently available mitigation options (primarily farm management practices) could see biological emissions fall by 10%.

However the group noted that “the ability of farmers to implement such practices varies widely, and while some farmers might achieve such reductions without significant negative impacts on profitability, for others the impact could be large.

“A greater than 10% reduction in absolute biological emissions will likely require a combination of on-farm mitigation and land-use change.”

The group also concluded: “Modelling indicated that when all mitigation options assessed by the New Zealand Agricultural Greenhouse Gas Research Centre are combined into packages, and assuming various rates of adoption of each practice by farmers, overall biological emissions in the future could potentially be reduced between 10% to 21% by 2030, and by 22% to 48% in 2050, relative to Ministry for Primary Industries baseline projections.”

The concern

‘Farmers are going to be paying through the roof for emissions.’

The policy

Farmers have been given until 2025 to come up with their own way of pricing agricultural emissions at the farm level. If they don’t show they’re making enough progress, they could be brought into the Emissions Trading Scheme (ETS) as soon as 2022. If this happens, they will receive a 95% discount.

The context

Agriculture is responsible for 48% of New Zealand’s greenhouse gas emissions. Emissions from the sector increased by 14% between 1990 and 2017 – less than the industrial process and product use sector, which saw an increase of 39% over this time.

While the price of emissions under the ETS is expected to increase substantially over several years, at the current price of $25 per tonne of carbon emitted, the Interim Climate Change Commission estimated the average dairy farmer would pay 1 cent per kilo of milk solids.

Put in context, Fonterra’s 2019/2020 forecast Farmgate Milk Price is $6.55 to $7.55 per kg of milk solids. Presumably, whatever pricing scheme the agricultural sector comes up with will be cheaper than this.

The concern

‘Water reforms are going to cost tens of billions of dollars.’

The policy

The government is proposing to make a raft of legislative and regulatory changes by mid-2020 to clean up New Zealand’s waterways within “a generation”. It is considering restricting farmers from using new irrigation schemes or converting to dairy, unless they can prove this won’t increase pollution. It is also considering introducing tougher rules around fencing to protect waterways from farm runoff.

The Government wants to “tightly restrict any further intensification of land use through interim measures until all regions have operative freshwater management plans”.

It is also looking at ways of changing the Resource Management Act, updating the National Policy Statement for Freshwater Management and the National Environmental Standard for Sources of Human Drinking Water, and introducing a new National Environmental Standards for Freshwater and Wastewater.

The context

The Ministry for the Environment has provided a number of statistics that paint a bad picture of the state of our waterways. It estimated the amount of nitrogen leached from agriculture increased by 29% between 1990 and 2012, primarily due to an increase in nitrogen fertiliser use.

It also said New Zealand has lost 90% of wetlands to agricultural and urban development; meanwhile between 2006 and 2015 there was twice as much deforestation as afforestation.

However industry group DairyNZ maintains the government’s proposals are “so severe that the net result is a significant economic loss… potentially without the environmental gains they are hoping for”.

Its modelling suggests that by 2050 total milk production will fall by 24% and all exports by 5.2%. It has put an $80 billion price tag on the proposed water reforms over 30 years. An independent advisory panel is currently going through submissions on the proposals and will report back to the government.