President Alvi orders big relief to online fraud victims

ISLAMABAD: President Dr Arif Alvi has directed two private banks to pay Rs 1.9 million and Rs 0.744 million respectively to their customers who fell victim to online banking fraud at the hands of fraudsters, ARY News reported.

The President also the Banking Mohtasib to take up the matter of banking frauds with the State Bank of Pakistan (SBP) to get essential SOPs issued so that proven fraudulent personnel’s CNICs could be blacklisted, placed at Central negative list, and no Banking/financial facility could be extended to them by the Banking industry.

President Alvi issued these directions while rejecting two separate representations filed the private banks. A  citizen namely Qaiser Mehmood was holding an account with a private bank received a call from a number resembling the bank’s helpline and the caller advised him to activate his disabled digital banking app.

The citizens was trapped and eventually, Rs 2 million were transferred from his account through multiple transactions. Similarly, Brigadier (r) Muhammad Arif Shaikh received a call from fraudsters asking him for his banking credentials to remove some technical flaws from his account. Later, an amount of Rs 994,000 were transferred from his account through 19 transactions.

The citizens who were trapped asked their respective banks to refund their money, but to no avail. Feeling aggrieved, they separately approached the Banking Ombudsman to get relief. The Ombudsman directed the banks to refund the lost amounts to the customers.

The banks, then, separately filed representations against the Ombudsman’s decisions with the President. The President held personal hearing of the cases, and having listened to the parties and going through the available record, decided the cases in the complainants’ favour. President Alvi observed that the banks were found non-compliant with the SBP’s directives regarding the implementation of monitoring systems to detect fraudulent transactions.

President Alvi added that multiple consecutive transactions were conducted but it did not raise alerts and allowed the money to pass through the system. He noted that the banks also failed to establish the legitimacy of transactions in terms of Section 41 of the Payment System and Electronic Fund Transfers Act, 2007.

Read More: President directs CDNS to reimburse Rs1.2m to financial fraud victim

Earlier in October 2023, the President directed the Central Directorate of National Savings (CDNS) to reimburse an amount of Rs 1.2 million with profit to a woman victim of financial fraud.

The money was fraudulently withdrawn from the woman’s account through the issuance of a fictitious chequebook and affixing her fake signatures on the withdrawal slip.

President Alvi asked CDNS to refer the matter to FIA for proper investigation so that the delinquent officials of CDNS involved in the scam may be brought to the book and punished.