Reimburse Rs 1.5 lakh to credit card holder: Consumer forum to bank, firm

The Third Additional Bangalore Urban District Consumer Disputes Redressal Commission has ordered Standard Chartered Bank and Pay U Payment Private Limited to jointly reimburse Rs 1.5 lakh, which was fraudulently transacted from the credit card of a 63-year-old Bengaluru man during the Covid-induced lockdown period in April 2020.

Standard Chartered Bank had issued a credit card to N Nirmal Chander. It was supposed to expire in 2023. The credit limit was Rs 2.25 lakh. A fraudulent transaction took place on April 29, 2020 for Rs 1.5 lakh from his credit card.

The amount was paid to Pay U Limited without his knowledge. Much to his shock, he didn’t receive any OTP, SMS or mail alert from the bank.

Chander came to know about the transaction only on May 5, 2020, when a message was sent from the bank informing him that the amount due for payment on May 26 , 2020, was Rs 1,57,652.

Immediately, he informed the same to the bank’s customer care. He was informed that Rs 1.5 lakh was paid to Pay U Limited.

Hence, he lodged a complaint about the fraudulent transaction on May 5, 2020, through the bank’s customer cell.

After eight working days, the bank told him to register a complaint with the cyber crime police. As he didn’t receive any response from either the police or the bank, he issued a legal notice.

The disputed transaction was processed with two factor authentications. The one-time password (OTP) was sent to his mobile number and an e-mail was updated.

The OTP/SMS log was retrieved and it was noted that the transaction was successful post validation of the OTP. Hence, it appeared that it was a valid transaction, the counsel for the bank argued.

Hearing both sides, the commission felt that while operating the credit card, the customer will only be a layman. It is not expected that the credit card holder had the knowledge regarding processing of the transaction between the bank and Pay U Limited.

Neither the bank nor the payment limited disclosed whom the amount of Rs 1.5 lakh was paid to and ultimately, to which account the said amount was credited. It is their responsibility to find out to whom the money was paid to when a dispute was raised, the commission said.

Though the credit card holder had informed the customer care immediately about the fraudulent transaction, the bank didn’t reimburse the amount, the commission said.

The commission ordered the bank and Pay U Limited to jointly reimburse Rs 1.5 lakh along with 9% annual interest from April 29, 2020, till realization.

It also directed to pay Rs 15,000 towards mental stress, legal fee and litigation expenses. They have to comply with the order within 30 days.