Panchkula: Failure to act on customer’s fraud complaint costs bank ₹80,000 - Hindustan Times
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Panchkula: Failure to act on customer’s fraud complaint costs bank 80,000

By, Panchkula
Feb 29, 2024 05:58 AM IST

Disposing of the complaint, SBI bank was directed to pay compensation of ₹10,000 to Tarsem Kumar Mahajan, 63, of Sector-20, Panchkula, along with ₹5,500 as cost of litigation

Holding bank deficient in services, District Consumer Disputes Redressal Commission, Panchkula, directed State Bank of India to pay 10,000 as compensation to a 63-year-old, Sector 20 resident, who lost 64,999 to fraudulent withdrawal in 2021.

The bank has also been directed to pay <span class='webrupee'>₹</span>64,999 to the complainant along with 9% interest from August 2021 till its realisation. (HT File Photo)
The bank has also been directed to pay 64,999 to the complainant along with 9% interest from August 2021 till its realisation. (HT File Photo)

Disposing of the complaint, SBI bank was directed to pay compensation of 10,000 to Tarsem Kumar Mahajan, 63, of Sector-20, Panchkula, along with 5,500 as cost of litigation. The bank has also been directed to pay 64,999 to the complainant along with 9% interest from August 2021 till its realisation.

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“As per the circular issued in July 2017 by the RBI, it was binding upon the bank to put in place the robust and dynamic fraud detection and prevention mechanism but we have no clue whether any fraud and detection mechanism has been put in place by the bank or not,” read the order of district consumer commission, pronounced on January 23, 2024, copy of which was made available now.

The district consumer commission order read, “It is well proved that the bank had failed to adhere to the guidelines issued by RBI in July 2017 and thus, the bank had been deficient while rendering services to the complainant.”

The district consumer commission referred to the RBI circular that mentioned “If a customer suffers loss in connection with the transactions made, without his junction, by fraudsters, it has to be presumed that it is on account of the failure on the part of the bank to put in places system which prevents such withdrawals and the banks are, therefore, liable for the loss caused to their customers.”

Money was lost in lieu of updating KYC

The victim, Tarsem Kumar Mahajan in his complaint had said that he had his savings account with State Bank of India. In August 2021, he got an SMS on his mobile along with a link for updating KYC. His mobile stopped working after he clicked on the link. After it was restored, a sum of 64,999 was found unauthorizedly withdrawn from his savings account in three different transactions. He immediately approached the bank and moved an application requesting to block his debit card as well as savings account and also requested to take action for recovery of the unauthorised withdrawal. He also lodged a complaint with the police. He alleged that the maximum limit of withdrawal amount on his debit card was 20,000 whereas a sum of 20,000 each was withdrawn vide two separate transactions within 2/3 minutes, which clearly proves that the SBI online software system had failed.

Money lost only because of the lapses on the part of the complainant: Bank

Seeking dismissal of the complaint, SBI said the transactions leading to the withdrawal of the amount from the account had occurred only because of the lapses on the part of the complainant. The bank argued that the withdrawal had occurred due to the clicking of an unknown link by the complainant, which clearly established the lapses and error on the part of the complainant and thus, the complaint is liable to be dismissed being frivolous, baseless and meritless.

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