July 23, 2025 • 4 mins
Banks are sounding the alarm over a new kind of subscription trap.
Instead of a typical ‘forgot to cancel scenario’, businesses are instead selling goods and services that hook customers into reoccurring subscription payments.
Westpac says it’s stopped nearly 20,000 customers from being fleeced in the past three months, stopping more than $25 million in unwanted charges.
Massey University banking expert Claire Matthews told Mike Hosking that the problem with this type of situation is it’s difficult to cancel the subscription.
Some companies, she says, straight up disappear when people try to cancel, so it’s easier to stop the payment upfront.
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Episode Transcript
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Speaker 1 (00:00):
Among the ever growing series of financial issues we need
to worry about. Banks are warning now over subscription traps,
businesses hooking people into ongoing payments through every day items,
the shoes and clothes, stuff like that. Anyway, Westpac, so
it's stopped nearly twenty thousand customers being fleeced in the
past three months. Doctor Claire Matthew's banking expert of course
at Massy in his back. Well, this is clear good
morning to you. What end am I Have you ever
(00:21):
fallen for a scam? You ever been scammed?
Speaker 2 (00:25):
Not in New Zealand, only on international travel. But there's
a slightly different situation.
Speaker 1 (00:30):
Okay, fair enough, these were If Westpac, a singular bank,
can stop twenty thousand customers over a three month period,
how many people are getting done for you know, must
be tens of thousands, hundreds of thousands of people.
Speaker 2 (00:42):
Oh, absolutely, it must be huge numbers. It seems unlikely
that Wes Westpac customers are being singled out, so presumably
it's tapeding to other banks customers as well. Absolutely, and
I noticed that as well as the twenty thousand customers
that they talked about, they've talked about twenty five million
dollars worth of payments, So that's you know, we are
talking large sums of money.
Speaker 1 (01:00):
So what is it? Is it payments you know you're
making but don't know how to stop, or payments you
don't know how you're making. Is it a trap or
is it illegal?
Speaker 2 (01:09):
It's a little bit hard to know because it's a
lot of something I've come across before, but I'm guessing
it's something like, you buy a pair of shoes and
in the fine printencies at the same time, when you
buy a pair of shoes, you also become a member
of our site, and we're going to charge you a
it's possibly a small subscription fee, and that will give
you access to we'll see your emails, or you'll have
(01:31):
access to our bargains, so that and special prices in
the future. But you don't actually want to do that.
You just brought up your shoes or whatever it is
you've brought. You didn't actually plan to ever buy anything
else from this business again, but they've sucked you in
because it's in the terms and conditions, and all of
a sudden you've got the small payment going out, which
you may not notice immediately depending on what else you're using.
(01:52):
Card for But Westek have obviously found a way of
picking up when this has happened.
Speaker 1 (01:56):
Good isn't there an app for that? I saw something
the other day. There's an app that tells you all
the stuff you're paying for that you may not know,
then goes ding. Do you realize, here's all the you
know and it'll tell you what you're doing.
Speaker 2 (02:09):
Yeah, But the problem with these ones, from what I
can understand from what Westak has said, is that it's
all very well to know that you don't want to
pay it, but you've actually got to get out of it.
And what's happening is trying to get hold of the
companies to say, actually, cancel my subscription. The companies disappear
or they just say, oh no, it's legitimate, So it
get's actually really difficult to cancel. So it's easier to
(02:31):
stop the payment upfront.
Speaker 1 (02:32):
Is it easy to let the bank do this if
they're in the business of doing this, good on them
for doing it, fantastic or I mean, I just don't
know how we fix it if you can't get out
of it, or you don't know you even paying it
in the first place. How do we solve this particular problem.
Speaker 2 (02:46):
Well, what are the issues is that we do need
to read the fine print when when we sign up
for things, which we're all very bad at doing. Yes,
you can trust the banks to be dealing with us
to an extent, but they're not going to pick up
everything because what the scam is a doing is constantly changing.
So we do need to be observant and looking at
our transactions and looking for anything that's unusual because we
(03:09):
may be the first or one of the first to
find something new so that it will help others.
Speaker 1 (03:13):
Good stuff. Nice to talk to you, clire As always
clear Matthews, Doctor Claire Matthews, Massa University. Rocket Money, Glenn
tells me is one of them that will be meaning
there's a miniuments.
Speaker 2 (03:20):
Do you do?
Speaker 1 (03:21):
You still have a Neon subscription as well as your Sky?
I was watching a bit of Neon yesterday finally enough.
Speaker 2 (03:25):
So why do you do that? Why do you have
Neon as well as the Sky? Now?
Speaker 1 (03:28):
I had an answer for that, and I can't remember
what it was, but when I came up with the answer,
it was something about express I get it earlier on Neon,
you'll get it earlier than on Sky. I think was
the answer. Here's his confession, and just like that, you
know the program, And just like that, I actually like it.
This is the sequel to the sequel of Sequelicity. I
(03:51):
actually like it. I've been watching it and I developed
a passion for it, and I thought, this is actually
I mean, there's a lot of it that's shocking, but
I thought as I watched, I thought, this is actually
quite a good program. And then I thought to myself,
I wonder if I should say that publicly, and what
people will think of me if I did.
Speaker 2 (04:07):
We're about to find out.
Speaker 1 (04:08):
I guess it's all too late now. For more from
the Mic Asking Breakfast, listen live to news talks. It'd
be from six am weekdays, or follow the podcast on iHeartRadio.
Among the ever growing series of financial issues we need
to worry about. Banks are warning now over subscription traps,
businesses hooking people into ongoing payments through every day items,
the shoes and clothes, stuff like that. Anyway, Westpac, so
it's stopped nearly twenty thousand customers being fleeced in the
past three months. Doctor Claire Matthew's banking expert of course
at Massy in his back. Well, this is clear good
morning to you. What end am I Have you ever
(00:21):
fallen for a scam? You ever been scammed?
Speaker 2 (00:25):
Not in New Zealand, only on international travel. But there's
a slightly different situation.
Speaker 1 (00:30):
Okay, fair enough, these were If Westpac, a singular bank,
can stop twenty thousand customers over a three month period,
how many people are getting done for you know, must
be tens of thousands, hundreds of thousands of people.
Speaker 2 (00:42):
Oh, absolutely, it must be huge numbers. It seems unlikely
that Wes Westpac customers are being singled out, so presumably
it's tapeding to other banks customers as well. Absolutely, and
I noticed that as well as the twenty thousand customers
that they talked about, they've talked about twenty five million
dollars worth of payments, So that's you know, we are
talking large sums of money.
Speaker 1 (01:00):
So what is it? Is it payments you know you're
making but don't know how to stop, or payments you
don't know how you're making. Is it a trap or
is it illegal?
Speaker 2 (01:09):
It's a little bit hard to know because it's a
lot of something I've come across before, but I'm guessing
it's something like, you buy a pair of shoes and
in the fine printencies at the same time, when you
buy a pair of shoes, you also become a member
of our site, and we're going to charge you a
it's possibly a small subscription fee, and that will give
you access to we'll see your emails, or you'll have
(01:31):
access to our bargains, so that and special prices in
the future. But you don't actually want to do that.
You just brought up your shoes or whatever it is
you've brought. You didn't actually plan to ever buy anything
else from this business again, but they've sucked you in
because it's in the terms and conditions, and all of
a sudden you've got the small payment going out, which
you may not notice immediately depending on what else you're using.
(01:52):
Card for But Westek have obviously found a way of
picking up when this has happened.
Speaker 1 (01:56):
Good isn't there an app for that? I saw something
the other day. There's an app that tells you all
the stuff you're paying for that you may not know,
then goes ding. Do you realize, here's all the you
know and it'll tell you what you're doing.
Speaker 2 (02:09):
Yeah, But the problem with these ones, from what I
can understand from what Westak has said, is that it's
all very well to know that you don't want to
pay it, but you've actually got to get out of it.
And what's happening is trying to get hold of the
companies to say, actually, cancel my subscription. The companies disappear
or they just say, oh no, it's legitimate, So it
get's actually really difficult to cancel. So it's easier to
(02:31):
stop the payment upfront.
Speaker 1 (02:32):
Is it easy to let the bank do this if
they're in the business of doing this, good on them
for doing it, fantastic or I mean, I just don't
know how we fix it if you can't get out
of it, or you don't know you even paying it
in the first place. How do we solve this particular problem.
Speaker 2 (02:46):
Well, what are the issues is that we do need
to read the fine print when when we sign up
for things, which we're all very bad at doing. Yes,
you can trust the banks to be dealing with us
to an extent, but they're not going to pick up
everything because what the scam is a doing is constantly changing.
So we do need to be observant and looking at
our transactions and looking for anything that's unusual because we
(03:09):
may be the first or one of the first to
find something new so that it will help others.
Speaker 1 (03:13):
Good stuff. Nice to talk to you, clire As always
clear Matthews, Doctor Claire Matthews, Massa University. Rocket Money, Glenn
tells me is one of them that will be meaning
there's a miniuments.
Speaker 2 (03:20):
Do you do?
Speaker 1 (03:21):
You still have a Neon subscription as well as your Sky?
I was watching a bit of Neon yesterday finally enough.
Speaker 2 (03:25):
So why do you do that? Why do you have
Neon as well as the Sky? Now?
Speaker 1 (03:28):
I had an answer for that, and I can't remember
what it was, but when I came up with the answer,
it was something about express I get it earlier on Neon,
you'll get it earlier than on Sky. I think was
the answer. Here's his confession, and just like that, you
know the program, And just like that, I actually like it.
This is the sequel to the sequel of Sequelicity. I
(03:51):
actually like it. I've been watching it and I developed
a passion for it, and I thought, this is actually
I mean, there's a lot of it that's shocking, but
I thought as I watched, I thought, this is actually
quite a good program. And then I thought to myself,
I wonder if I should say that publicly, and what
people will think of me if I did.
Speaker 2 (04:07):
We're about to find out.
Speaker 1 (04:08):
I guess it's all too late now. For more from
the Mic Asking Breakfast, listen live to news talks. It'd
be from six am weekdays, or follow the podcast on iHeartRadio.
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