Bank authorised Credit card fraud and how the victim got back the money!

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swatkats

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The Consumer Forum of Hyderabad ordered the Begumpet branch of Axis Bank and its head office in Gujarat to pay Rs 1.2 lakh to Mr Nelakanti Satyanarayana, a resident of SR Nagar, for not following Reserve Bank of India guidelines on security. The complainant on August 26, 2015, received an email notifying him about four transactions done in his account for a total sum of Rs 83,814. The money was deducted on-line by Entropy Factory SL, in euros, amounting to 1,670 euros.

Three transactions were approved by Axis Bank while one was declined. Mr Satyanarayana claimed that he sent a mail telling the bank that he had not authorised the transactions. He filled up a dispute form which was acknowledged by the bank on August 31. On October 20 the bank informed him that his request was denied and the amount was debited to his account.

Mr Satyanarayana approached the cybercrime police on October 24 and lodged a complaint. The bank allegedly refused to cooperate with the police officials during the investigation. Mr Satyanarayana’s card was blocked and a new card issued, but he received a notice from the bank demanding Rs 1 lakh incurred on his credit card.

He alleged that the fraud was committed in collusion with third parties authorised by the bank. He said that the bank officials were “callous in behaviour’, following a deduction of Rs 3,300 from his account on February 29, 2016, which was again not authorised by him.

Axis Bank contended that the transactions were done in a secure environment. Representatives of the bank stated that the amount of Rs 3,300 was credited to the complainant when the mistake was noticed. The amount of Rs 1 lakh was levied due to non-payment of dues, and they rejected the allegation of committing fraudulent transactions. The bank stated that the transactions were done using the 3D secure PIN — a number which should be known only to the user.

The consumer forum observed that it was the duty of the bank to have security measures in place to ensure that fraudulent transactions do not take place. The forum stated that as per the RBI guidelines, safe and secure electronic banking systems should be provided to customers. The guidelines also say that the complainant has zero liability even when there is a third party breach.

The forum ruled in favour of Mr Satyanarayana with the bank being asked to pay Rs 83,815 and not demand payment for the old credit card account. The bank should also pay a sum of Rs 30,000 as compensation and Rs 5,000 to cover litigation costs.

https://www.deccanchronicle.com/nat...0-filched-from-card-forum-backs-customer.html
 
Good, I was going to take the AXIS NEO card or something, will skip it.

Alas, an office collegue also had a similar issue with ICICI bank, he has a coral credit card or something similar. He is pretty sure that he has not done the transactions, but the bank is insisting that it has been done with the 3D secure PIN. in the end, got the card changed.
 
What should you do when a fraudulent transaction is conducted on your account?

The moment you realize a fraudulent transaction is being carried out on your account, you will have to act swiftly:
  1. Inform your bank of the unauthorized transaction as soon as possible, maximum within 3 days of occurrence. You can do this by contacting them via phone banking facility, SMS, email, toll-free number or by visiting a bank branch.
  2. Banks’ loss and fraud reporting system will immediately acknowledge your complaint and share the registered complaint number.

When are you liable for fraudulent transaction and when not

Scenarios when you are not liable

There are two scenarios when customers are not liable:

  • When the transaction occurs due to fraud or negligence or lack of appropriate checks on the part of bank, even if the customer fails to report it to the bank. For example, malware attacks, or large-scale account hacks.
  • When the fraud occurs due to your negligence but you report the incident within 3 working days. For example, loss of credit card or sharing account/card details with strangers.
Scenarios when you are liable

You are liable when you delay reporting the fraudulent transaction to the bank by more than 3 working days.

  1. Delay in reporting by 4 – 7 working days: You will have to pay an amount equal to the transaction value or as per the bank’s Board’s policy, whichever is lower. Refer Table 1 for more details. But even in such a scenario, you are liable only for the loss occurring till the time you report the incident to the bank. So, even if unauthorized transactions continue (which is unlikely as banks block the card or account when informed of breach or loss), you won’t have to bear the losses.
  2. Delay in reporting beyond 7 working days: In this case, you will be liable as per the bank Board’s approved policy. The maximum liability will vary according to the account that has been breached. For instance, in the case of savings account, your maximum liability is Rs 5000, whereas for credit cards (with limit > Rs 5 lakhs) the maximum liability is Rs 25,000. Refer Table 2 for details.
Another crucial aspect the RBI has touched upon is making it banks’ responsibility to prove customer liability in the case of unauthorized electronic banking transactions. As a result, banks will have to prove whether the fraud occurred due to customers’ negligence. Instances of customer negligence include disclosing your card details to someone or losing your credit or debit card.


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Source: https://www.paisabazaar.com/credit-...ansactions-on-credit-card-what-should-you-do/
 
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