SBI Ordered to Compensate UPI Scam Victim by Consumer Court

Oct27,2023 #Consumer Court #SBI #UPI Scam
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Published on: October 27, 2023 at 18:27 IST

The Consumer Disputes Redressal Commission (CDRC) in Navsari, Gujarat, has issued a ruling compelling the State Bank of India (SBI) to provide compensation to a victim of a UPI cyber fraud. The court’s decision highlights the bank’s responsibility to promptly address fraudulent transactions when reported by customers.

The case revolves around an incident of cyber fraud that transpired on December 22, 2021, where the victim, identified as Vidhi Suhagiya, incurred a loss of Rs 59,078 due to unauthorized transactions. Acting swiftly, Suhagiya immediately approached the bank authorities to report the fraudulent activity.

Simultaneously, she filed a complaint with the cybercrime helpline, leading to the freezing of Rs 19,500 in a Federal Bank account. Subsequently, following the court’s directive, this frozen amount was returned to her account.

Despite her diligent efforts to seek restitution, SBI initially declined to reimburse Suhagiya the sum of Rs 39,578, contending that the fault lay with her. Undeterred by the bank’s resistance, Suhagiya sent a legal notice, which unfortunately yielded no response. Frustrated by the bank’s lack of action, she eventually sought justice by approaching the CDRC.

During the legal proceedings, SBI’s advocate persistently claimed that Suhagiya was responsible for the incident, absolving the bank of any liability.

However, the CDRC swiftly dismissed this argument, underscoring that Suhagiya had promptly alerted the bank about the fraud on the same day it occurred.

The court criticized the bank for its failure to act on the complaint, citing negligence in halting the unauthorized payment and freezing the amount. The CDRC characterized SBI’s conduct as displaying “serious carelessness and a mistake in service.”

In light of these findings, the CDRC has ordered SBI to compensate Suhagiya with the sum of Rs 39,578, underscoring the bank’s duty to protect its customers from cyber fraud. This ruling establishes a crucial precedent, emphasizing the imperative for banks to take swift action upon being informed about potential fraudulent activities.

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