In a significant ruling, the National Consumer Disputes Redressal Commission (NCDRC) has ordered the State Bank of India (SBI) to pay ₹63.74 lakh to a customer as a refund following a fraudulent account drain. The bank was also instructed to pay ₹97,06,491, which includes 9% annual interest and an additional ₹3.20 lakh as compensation and legal expenses.
The case involved an elderly couple who had opened a joint fixed account and three fixed deposits (FDs) totaling ₹40 lakh in August 2017. In April 2019, they discovered that only ₹3 lakh remained in their account, with the rest of the funds having been withdrawn through a series of fraudulent transactions.
The investigation revealed that the unauthorized transactions were conducted using a different phone number, not linked to the couple’s registered number. The couple, who did not own a smartphone, confirmed that they had never authorized these transactions.
SBI attempted to blame the couple for their negligence, claiming that they shared their mobile, PIN number, and other details with associates, leading to the fraudulent transactions. However, the NCDRC found that the bank failed to secure the account and that the incident could have been avoided if the bank had updated security protocols.
The NCDRC emphasized that the responsibility for safeguarding customer accounts lies with the bank. SBI’s failure to do so resulted in a significant financial loss for the couple. The incident prompted SBI to reform its internet banking system by requiring physical presence of customers to activate internet banking services. This measure aims to protect customers, especially those who may not be technologically advanced, from potential fraud.
This case highlights the importance of robust security measures in banking and the need for banks to prioritize customer protection. The NCDRC ruling serves as a strong reminder to financial institutions about their accountability in preventing fraud and ensuring the safety of customer funds.
