President ordered the banks to credit the lost money to their account holders in fraudulent digital transactions.
Petitions with the Banking Mohtasib against Habib Bank and United Bank Ltd (UBL) on inadvertent transactions of Rs 300,000, Rs 750,000 and Rs 250,000 from their accounts, respectively.
ISLAMABAD ( Web News )
President Dr Arif Alvi on Monday upheld the decision of the Banking Mohtasib in three similar cases, wherein it had ordered the banks to credit the lost money to their account holders in fraudulent digital transactions.
The complainants Najma Sultana, a retired teacher and widow; Zahid Shah, a technician of Pakistan Air Force and Tariq Mehmood Chaudhry, a semi-literate person, had filed petitions with the Banking Mohtasib against Habib Bank Ltd (HBL) and United Bank Ltd (UBL) on inadvertent transactions of Rs 300,000, Rs 750,000 and Rs 250,000 from their accounts, respectively.
In their pleas, the complainants had maintained that they had never requested for activation of the Internet Banking Facility (IBF). Also, they stressed that they were not well-versed with digital banking or capable of handling such sophisticated banking products.
The Banking Mohtasib in its separate orders had advised the banks to make good the loss of complainants by crediting the amount, which had been unauthorizedly debited from their accounts.
Terming it a clear violation of the circulars under Payment System & Electronic Fund Transfer Act, 2007 of the State Bank of Pakistan, the Banking Mohtasib had said that the onus was upon the banks to educate the account holders regarding their consent and the threats and risks of mobile banking.
President Alvi, in his written order on the representations of the banks assailing the decision of Banking Mohtasib, said the “strange and evasive stance” of the banks of denying their responsibility for the loss of its customer’s money, was “just shrugging off its fiduciary duty to an innocent account holder”.
He said the loss of money to the complainants had occurred due to the reason that the banks’ facility of EFT was made operational without their consent.
“Had this channel not been opened by the Bank(s), the account holder(s) would have avoided this financial loss,” he stressed.
The President said the banks could not produce any document or evidence to the effect that they had complied with the provisions of law, rules and regulations.
He noted that the banks were given ample opportunity to defend and controvert the claim of the complainant before the learned Banking Mohtasib and even before this forum.
“However, (banks) have failed to discharge the burden and statutory liability cast upon it under the law. Hence, no justification has been made to upset the order of the learned Banking Mohtasib,” he said.
The President, therefore, rejected the representations of the banks being “devoid of any merit”.