Islamabad, November 29, 2023 – President of Pakistan, Dr. Arif Alvi, has directed Allied Bank Ltd (ABL) to compensate a customer, Ameer Ali Wasan, with Rs 344,600, following the fraudulent transfer of funds from his account. The decision upholds the orders of the Banking Mohtasib, who had earlier instructed ABL to refund the defrauded amount.
The President’s decision comes after the bank’s maladministration was deemed responsible for the financial loss suffered by the customer. The President House, in a statement on Wednesday, highlighted that ABL had opened the fund transfer facility without the customer’s consent, a violation that led to financial consequences for the account holder.
The case originated when the complainant, Ameer Ali Wasan, received a phone call from a number resembling the bank’s helpline. Subsequently, a sum of Rs 344,602 was fraudulently transferred from his account. The President’s decision underscored that if the Internet Banking/Electronic Funds Transfer (IB/EFT) facility had not been activated without the customer’s consent, the financial loss could have been averted.
President Alvi observed that the complainant had not requested the IB/EFT facility nor had he engaged in any transactions through such channels in the past. Wasan promptly filed a complaint with the bank after the fraudulent activity, but his grievance remained unresolved. Consequently, he approached the Banking Mohtasib seeking a refund of the lost amount.
The Mohtasib, in response, directed ABL to refund the defrauded amount. However, the bank contested the decision, filing a representation with the President. Following a personal hearing of the case, the President concluded that ABL failed to establish the legitimacy of the disputed transaction in accordance with Section 41 of the Payment System and Electronic Funds Transfer Act, 2007.
The President’s decision highlighted concerns about the bank’s failure to trigger the alert system despite the suspicious pattern of transactions conducted on a single date in a short span of time. He emphasized that such situations should prompt the bank to contact the customer, calling for a broader consideration by both banks and the regulator, the State Bank of Pakistan.
Furthermore, President Alvi noted that the citizen, Ameer Ali Wasan, lacked familiarity with digital banking and modern banking products. In light of these factors, the President deemed the IB/EFT facility as unsolicited, emphasizing ABL’s failure to comply with the binding provisions of the Payment Systems and EFT Act 2007 and directives issued by the State Bank of Pakistan.
The President rejected ABL’s representation and directed the bank to report compliance to the Banking Mohtasib within 30 days from the date of the order. This decision underscores the significance of adherence to regulatory frameworks and customer consent in financial transactions, aiming to protect consumers from fraudulent activities and ensure accountability within the banking sector.
