The state consumer commission has directed DCB Bank limited to give Rs 32.88 lakh with nine percent interest to its customer after the money was transferred to an account that the customer did not authorise. During the hearing, the bank admitted that it received two hacked emails within four days asking it to transfer the above amount to a third party, which it acted on without confirming.
Money sent without confirming exchange rate
The customer, back then living in Kuwait and having an account with the bank, had made an arrangement to send remittances to his son studying in the US. As per that agreement, the remittance had to be requested each time as insisted by the bank, would be of a fixed amount (US $2,500) at a fixed date of a month and sent only after confirming the exchange rate. In the present case, the money was sent when the customer had stopped sending remittances with the amount and date not matching and money sent without confirming the exchange rate.
The commission directed a further compensation of Rs 1.50 lakhs within three months else it would carry an additional interest of six percent. The order dated May 11, 2023 was passed by Justice S. P. Tavade, president and S. T. Barne, judicial member of the State Consumer Disputes Redressal Commission (SCDRC). It was given on a complaint by Ajoj Kumar Mehta and Sheelu Mehta against DCB Bank Limited.
How the victim was duped
Mehta, a chartered accountant by profession received his retirement benefits in 2014. He made fixed deposits with the opponent to the tune of Rs 2 crores for a period of three years with an overdraft facility of 90% of the fixed deposit amount. After depositing the amount, the complainants decided to send $2,500 to his son as remittance who was studying in the US through the overdraft account. For this, he had issued instructions that on 26h of every month, ₹2,500 be sent to his son Anchit Mehta's. The forex department refused to transfer regular money on standing instructions. It demanded that Mehta make requests for each transfer. Mehta pre-signed some RTGS forms and gave them to the branch manager in advance for transactions to be executed but after seeking his approval on exchange rate.
Victim loses $53,000 in total
After a few remittances, Mehta, by November 2014 realised that transferring funds from India through the overdraft account is a costly affair because of higher exchange rate and service tax etc. He then decided to remit the funds from Kuwait and not through the overdraft account. After he stopped the remittance service of the bank, the bank received two emails requesting remittance. One on January 27, 2015 and another on January 30, 2015 seeking transfer of USD 25,000 and USD 28,000 to an account of a third party in New York. These transfers led to a cumulative loss of USD 53,000 (Rs 32.88 lakhs as per then exchange rate). The bank did not bother to look at the name of the beneficiary, nor did it bother to call the Complainant to verify the instruction. It also did not confirm the foreign exchange rate.
Bank says they acted on instructions
When Mehtas approached the bank, they said that they acted on the instructions. Mehta approached senior officials of the bank, its corporate office who assured of help but eventually nothing happened. He even approached the RBI for help. At commission stage, the bank said that a complaint should have been filed with the Kuwait Police and with the Cyber Cell since electronic instructions had been received from the complainants for remittance of funds overseas which has not been done by the complainants. It stated that some investigation was required for alleged fraudulent transfer. Mehtas on the other hand cited RBI circular of zero liability of customers in case of fraudulent transaction.
The Commission stated that "there is negligence and deficiency in service on the part of the officers" of the bank and so complainants are entitled for zero liability. It then directed the bank to give the money back to the complainants.
FPJ
