Consumer court orders bank to refund Rs 2.4L lost to online fraud due to KYC breach
Dehradun: A consumer court has ordered a private bank to refund Rs 2.4 lakh to a customer after finding that its failure to complete KYC checks allowed fraudsters to siphon off funds from his account in an online scam in 2016.
The court also directed
ICICI Bank
's branch on Rajpur Road to pay Rs 25,000 in compensation and litigation costs.
Merchant navy officer Ashutosh Vijan had filed a complaint with the Dehradun district consumer commission after his NRI account was compromised in an
online fraud
. On March 3, 2016, Vijan received an SMS about a debit of Rs 1 lakh from the account. He rushed to the bank but before he arrived, he received more transaction alerts.
At the branch, officials blocked his account and initiated action to recover Rs 5 lakh that had been transferred to other accounts.
The bank assured Vijan that the full amount would be restored within 30 to 45 days. However, the refund never came and Vijan returned to duty on his ship.
After 10 months of inaction, Vijan approached the consumer commission. He said the bank failed to carry out KYC on the accounts where his money was transferred. He also flagged the lack of a mandatory 30-minute gap between four back-to-back transactions totalling Rs 5 lakh, which were executed within 13 minutes.
The commission reviewed the documents and upheld Vijan's claims. It noted the absence of an internal investigation report from a senior official. It was found that all four beneficiary accounts were forged and had not undergone any KYC checks.
Vijan said the bank refunded only Rs 2.6 lakh, while the remaining Rs 2.4 lakh was never returned. The commission ordered the bank to repay the outstanding amount with 7% interest per annum from the date of the complaint. It also directed the bank to pay Rs 20,000 in penalty and Rs 5,000 towards litigation costs.
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