In, what could be known as path breaking judgement which will provide much needed relief to Digital Arrest scam victims across India, the DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION ADDITIONAL DCF, NAGPUR, MAHARASHTRA, has provided much needed relief by awarding the COMPENSATION of amount transferred under coercion and threat.
The complainant, digital arrest threatened victim, on 08.01.2023, received a phone call from a person claiming to be from FedEx Customer Service. The caller informed her that an international parcel had been booked in her name and that the parcel contained two passports, five ATM cards, 300 grams of weed, and a laptop. When complainant denied having booked any such parcel, she was told to speak with the Mumbai Police and was threatened that her identity had been misused and had been involved in unlawful activities. By creating fear, intimidation and threat of Arresting her, in mind of complainant, she was induced to transfer amounts of Rs.95,499/-, Rs.3,07,939.50, Rs.1,90,000/-, and Rs.99,999/-, aggregating to Rs.6,93,437.50, into some bank account towards alleged investigation and processing charges, on one single day.
After some time of last payment, the complainant regained her senses and realized that she had been subjected to fraud and she immediately contacted the customer care service of the Opposite Party Bank and registered a complaint. Bank advised her to report the matter to the National Cyber Crime Portal and which was also complied.
The complainant was granted a temporary credit (shadow credit) initially by respondent bank. Thereafter the Opposite Party Bank informed complainant that she had confirmed the transactions through OTP authentication and that the transactions had been carried out through her registered mobile number. Since debit alerts relating to the transactions had been sent to her registered mobile number, the shadow credit was subsequently reversed.
Thereafter the complainant approached the Banking Ombudsman regarding the matter and the Ombudsman directed that an amount of Rs.1,75,000/-, being approximately 25% of the disputed amount, be credited to her account. The complainant has stated in her complaint that the findings recorded by the Ombudsman revealed that the beneficiary accounts belonged to another branch of the Opposite Party Bank and was used as Money Mule account.
The beneficiary was a trader whose annual income was between Rs.1 lakh and Rs.5 lakh, while the annual turnover was approximately Rs.40 lakh. There were no transactions in the beneficiary’s account for last three months and suddenly in three days this account witnessed transactions worth Rs. 2.84 crore.
The complainant moved before this commission, through Adv Dr Mahendra Limaye, with contentions that the Opposite Party failed to exercise due care and acted negligently in protecting her account by filing Consumer Complaint.
The Opposite Party, in its written version, has contended that the present complaint is not maintainable in law and that it is false, baseless, and vexatious and present dispute does not fall within the ambit of a consumer dispute and, therefore, the complaint deserves to be dismissed. They also argued that complainant has already lodged a complaint with the police regarding the unauthorized transactions from her bank account and that the investigation is still in progress. Therefore, according to the Opposite Party, the identity of the actual wrongdoer has not yet been established. Opposite Party further contended that, in the present era of digital banking, the complainant ought to have exercised due caution before transferring the amount, which she failed to do.
The Hon Commissions findings observe that the specific case of the complainant is that the Opposite Party failed to take the necessary precautions for the protection and security of the account holder and that such failure on the part of the Opposite Party constituted deficiency in service and negligence, which contributed to the fraudulent transactions committed against her.
The counsel for the complainant, Adv Dr Mahendra Limaye, further argued that the Opposite Party ought to have considered the complainant’s accounts normal transaction pattern and on penultimate day, there was a sudden deviation in the transaction pattern, and it was the responsibility of the Opposite Party to monitor such deviation and red flag the account.
The complainants counsel also relied on RBI Master guidelines related to undertaking on-going due diligence of customers to ensure that their transactions are consistent with their knowledge about the customers, customers’ business and risk profile, the source of funds / wealth and mandated monitoring of (a) Large and complex transactions including RTGS transactions, and those with unusual patterns, inconsistent with the normal and expected activity of the customer, which have no apparent economic rationale or legitimate purpose, (b) Transactions which exceed the thresholds prescribed for specific categories of accounts, (c) High account turnover inconsistent with the size of the balance maintained, (d) Deposit of third-party cheques, drafts, etc. in the existing and newly opened accounts followed by cash withdrawals for large amounts.
Considering all these facts and circumstances, the Commission held that the Opposite Party failed to exercise the degree of care required of it and is guilty of deficiency in service. Even after the complainant promptly informed the Opposite Party immediately after the incident, the Opposite Party failed to take immediate steps to stop or freeze the amount that had been transferred to another branch of the same bank before it came under the control of the stranger or fraudulent person. This conduct is wholly improper.
It is hereby declared that the Opposite Party has committed deficiency in service, negligence, and has adopted unfair trade practices within the meaning of the Consumer Protection Act, 2019.
Hence in its Final order commission directed the Opposite Party to pay to the complainant a sum of Rs.5,18,437/- (Rupees Five Lakh Eighteen Thousand Four Hundred Thirty-Seven only), together with interest @ 9% per annum from 08.06.2023, i.e., the date of filing of the complaint, until the date of actual realization. Further the Opposite Party is directed to pay to the complainant a sum of Rs.25,000/- (Rupees Twenty-Five Thousand only) towards compensation for the physical and mental agony suffered by her. The Opposite Party shall further pay a sum of Rs.10,000/- (Rupees Ten Thousand only) towards the costs of the proceedings. The aforesaid amounts shall be paid by the Opposite Party to the complainant within 45 days from the date of this order.
This judgement will be of help to many such digital arrest scam as well as other cyber scam affected victims to approach Consumer Commissions for appropriate relief. Complainant was represented by Adv Dr Mahendra Limaye and respondent bank was represented by Adv P G Mewar.
Sitabuldi, Nagpurinfo@cyberordindia.com+91 9422109619
