Daijiworld Media Network – New Delhi
New Delhi, Jan 9: In a landmark ruling, the Supreme Court of India has directed the State Bank of India (SBI) to refund Rs 94,000 to a victim of cyber fraud from Assam. This judgment highlights the crucial responsibility of financial institutions to protect their customers' funds from online scams, setting a significant precedent in handling cyber fraud cases.
The incident occurred when the victim, attempting to return a Louis Philippe blazer worth Rs 4,000, fell prey to a scammer posing as a customer service representative. The fraudster tricked the victim into installing a malicious app, which enabled the theft of Rs 94,204 from his SBI savings account. The stolen money was transferred through multiple UPI transactions. Investigations revealed that the scam originated from a 2021 data breach on the Louis Philippe website, which compromised sensitive customer information, including the victim's contact details. Leveraging this data, the fraudster orchestrated the scam, leaving the victim with an unwanted blazer and a wiped-out bank account.
Upon discovering the fraudulent transactions, the victim took immediate steps to block his account and reported the incident to the Assam police, the RBI banking ombudsman, and the ministry of home affairs via its National Cyber Crime Reporting Portal. Despite his swift actions, SBI denied responsibility, arguing that the transactions occurred via Google Pay, a third-party app not directly recommended by the bank. Refusing to accept SBI's stance, the victim pursued legal action, eventually securing a favourable judgment from the Guwahati high court. The court found SBI negligent in its handling of the fraud, especially since the bank had been informed within hours of the incident. Consequently, the high court ordered SBI to refund the entire amount lost.
SBI escalated the matter to the Supreme Court, challenging the high court's ruling. However, the Supreme Court upheld the initial judgment, criticizing SBI for its lack of timely intervention. The court emphasized the bank’s responsibility to utilize its advanced technological capabilities to prevent such fraud and directed it to refund the stolen amount. Additionally, the court permitted SBI to recover the money from the fraudster, who had already been apprehended by the Assam police.
The ruling also highlighted the importance of vigilance on the part of both banks and customers. The Supreme Court reiterated that while financial institutions must actively work to prevent cyber fraud, customers should exercise caution when sharing sensitive information or using third-party applications.