Karachi, April 25, 2025 – The Banking Mohtasib Pakistan has ordered a major commercial bank to refund Rs1,295,000 to a customer after it allowed fraudulent transfers from his account through a mobile device that was not verified using biometric authentication, violating key security protocols.
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President Orders Banking Services Block for Fraudsters
Islamabad, January 21, 2024 – President Dr. Arif Alvi has taken a firm stand against banking fraud, ordering the blocking of banking services to fraudsters.
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President Alvi Orders Allied Bank to Compensate Fraud Victim
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.
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SBP directs banks to formulate digital fraud prevention policy to protect account holders
The State Bank of Pakistan (SBP) has issued new policy guidelines for banks in the country, instructing them to formulate a digital fraud prevention policy to safeguard their customers’ accounts.
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Pakistan’s renowned novelist becomes victim of online bank fraud
Pakistan’s renowned novelist Mirza Athar Baig has become victim of online bank fraud and lost Rs 1.1 million from his bank account.
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HBL ordered to compensate bank fraud victim
ISLAMABAD: President of Pakistan, Dr. Arif Ali Alvi, on Wednesday ordered Habib Bank Limited (HBL) to immediate compensate a victim of bank fraud.
President Dr Arif Alvi reprimanded HBL for unnecessarily dragging the matter of reimbursement of a trivial amount of Rs. 39,000 to the victim of bank fraud.
READ MORE: SBP takes measures for prevention of digital bank fraud
He directed the bank to reimburse the defrauded amount, along with the payment of transportation charges, within fifteen days to the victim and termed the action of the HBL an act of malpractice and maladministration.
The President reprimanded the HBL for preferring representation before the President against the order passed by the Banking Ombudsman in favor of the victim of the bank fraud involving a meager amount.
READ MORE: SBP directs banks to report digital fraud cases
The President observed that the transfer of money from one account to another through cheating was a common incident of fraudulent activity but despite the knowledge of the account where the money landed and was then withdrawn no action was taken against the beneficiary of the transaction.
The President emphasized that the bank was liable to make good the loss of their customers and advised the bank management to look into the issue and take remedial measures to safeguard the interest of its customers, especially the small depositors and account holders.
READ MORE: Habib Bank, Meezan Bank directed to pay fraud victims
The President directed the State Bank of Pakistan, being a regulatory body, to take earnest action against both the Banks and bank branches by adopting regulatory and punitive action to redress the fraudulent activities which result from noncompliance with Rules and Regulations issued by the State Bank of Pakistan.
According to the details, an unknown person tricked Nazeer Ahmad Bhutta to provide the last digits of his ATM card and later deprived him of his deposit.
READ MORE: President Alvi rejects MCB Bank’s appeal in fraud case
The victim preferred an appeal before the Banking Ombudsman who decided the case in favour of the victim. However, HBL, instead of implementing the decision, preferred representation to the President.
The President upheld the decision of the Banking Ombudsman and directed the Bank to reimburse the defrauded money to the complainant.
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SBP directs banks to report digital fraud cases
KARACHI: The State Bank of Pakistan (SBP) has directed banks to submit reports of all digital frauds and scams related to their account holders.
The SBP issued a circular dated May 26, 2022 said it had been decided that all banks and microfinance banks (MFBs) would additionally submit data of all digital frauds and scams on monthly basis.
“This will include all frauds and scams reported at call centers or through other means such as email, letters, etc. or otherwise detected by the banks/ MFBs themselves,” the central bank said.
The banks/ MFBs shall report data as per the prescribed format to the Banking Supervision Department (BSD)-2 of SBP on monthly basis.
The data shall be reported in soft copy in Microsoft Excel format (Annexure – A) within 10 days from the close of every month at email ID [email protected].
The SBP directed the banks to submit reports of frauds and scams related to digital products. The report shall also include the cases of frauds related to: number of accounts/cases; mobile app/wallet (Android); mobile app/Wallet (IOS); E-Commerce Transactions/Merchant Payment Authorization (via USSD/Mobile App/Internet Banking; internet banking; USSD; Branchless Banking Agent Retail Application; ATMs; Point of Sale; and other digital channels.
The banks are required to provide details of digital fraud including number of affected accounts and amount disputed. Further, related to digital scams, the banks are required to provide number of affected accounts and amount disputed.
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NBP directed to pay Rs0.5 million to fraud victim
ISLAMABAD: The President of Pakistan, Dr Arif Alvi, has directed National Bank of Pakistan (NBP) pay Rs0.5 million to a victim of bank fraud.
The president upheld the decision of the Banking Ombudsman and directed the NBP to pay Rs500,000 to the citizen who had been the victim of bank fraud at the hands of a former branch manager.
READ MORE: SBP takes measures for prevention of digital bank fraud
The president ordered that the bank must return the lost money to the victim and expressed dismay that the bank refused to own up to its responsibilities when a fraud had been committed by the employees of the bank against its customers.
Muhammad Abdul Rasheed (the complainant), a resident of Faisalabad, had opened a bank account with the Hassan Road Branch, Jaranwala, and had handed over cash of Rs500,000 to the then manager, Akhtar Hussain, who gave the complainant a duly signed and stamped deposit slip.
Later, upon visiting the branch to get his cheque book, the complainant came to know that an internal fraud had been committed by the then branch manager and he was one of the many victims of bank fraud and his money had not been deposited in his account by the manager.
READ MORE: President Alvi rejects MCB Bank’s appeal in fraud case
A total of 56 affected accountholders submitted their claims to the bank amounting to Rs98.018 million for refunding of their defrauded amounts.
Abdul Rasheed also approached the bank to receive his claim but was not provided any relief.
Subsequently, he sought the assistance of the Banking Ombudsman to retrieve his lost amount who ordered that the bank pay the complainant his lost money. The NBP then filed representation with the President against the decision of the Ombudsman.
President Dr Arif Alvi rejected the representation of the bank on the grounds that the deposit slip carrying the manager’s signature and stamp constituted a valid receipt and bound the bank to honour it.
He upheld Ombudsman’s observation that although the bank manager had been dismissed by the bank and FIA was investigating the matter, the proceedings of the Ombudsman were of civil nature and were independent of any criminal prosecution by the FIA.
READ MORE: Habib Bank, Meezan Bank directed to pay fraud victims
He further noted that the complainant was dealing with the authorized agent of the bank who was not only in active service of the bank as the branch manager but had received the cash during banking hours within the premises of the bank against a valid deposit slip.
While terming the act of the ex-manager an act of maladministration and malpractice, the president further observed that the perusal of the relevant sections of the Federal Ombudsmen Institutional Reforms Act, 2013 showed that in matters falling within the jurisdiction of the banking ombudsman, the jurisdiction of other courts or authorities was excluded.
READ MORE: Bank branch manager defrauds 29 customers
He wrote that the bank was given ample opportunity to refute the claim of the complainant and it failed to discharge the burden and statutory liability cast upon it under the law.
Since no justification has been made to upset the original order of the Ombudsman, therefore, the representation of the bank was devoid of any merit and deserved to be rejected, he ordered.
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Habib Bank, Meezan Bank directed to pay fraud victims
ISLAMABAD: The President of Pakistan, Dr. Arif Alvi has directed Habib Bank Limited and Meezan Bank to pay victims of bank fraud. The President rejected the representation of the banks and upheld the decision of Banking Mohtasib (Ombudsman).
President Dr Arif Alvi has provided relief to 6 different victims of bank fraud by upholding the decisions of the Banking Mohtasib ordering private banks to refund a collective sum of over Rs 827,000 to the accountholders.
The President rejected 05 different representations of Habib Bank Limited (HBL) and 01 representation of Meezan Bank Limited against the decisions of Banking Mohtasib directing them to make good the loss of the victims of bank fraud by crediting the lost money to their individual bank accounts.
As per the details of the cases, Muhammad Pervaiz Khan, Kashif Latif, Naimat Ali, Intezar Ahmed, Ms Asia Manzoor, and Mohsin Shabbir (the complainants) had been maintaining their individual bank accounts with HBL.
They received calls from unknown numbers and the callers posed as bank officials and asked them to share their personal credentials which they did. The callers managed to defraud Pervaiz Khan of Rs 333,300, Latif of Rs 140,000, Naimat of Rs 137,489, Intezar of Rs 119,848, Ms Asia of Rs 78,780 and Shabbir of Rs 20,108 by fraudulently transferring funds from their bank accounts.
Afterward, they received alerts about hefty amounts being withdrawn from their bank accounts. The complainants approached the bank to get their defrauded amounts refunded, however, they were not given any relief.
Later, the complainants approached the Banking Mohtasib individually to seek redressal of their complaints. The Banking Mohtasib in its decision wrote that the bank had activated fund transfer service i.e., IB/EFT channel by default without informing the complainants and had not divulged the pros and cons of the “fund transfer” facility in terms of Section 30 of Payment System and Electronic Fund Transfer Act-2007.
It noted that since the facility was unsolicited, therefore, any financial loss in this regard cannot be categorized as “customer liability”.
It further observed that had IB/EFT channel not been made operational by the bank, the complainants could have avoided the financial loss.
The Banking Mohtasib held that the bank could not produce any evidence to the effect that it had complied with the provisions of law, rules and regulations and ordered the bank to refund the defrauded money to the complainants.
Subsequently, the banks filed representations with the Honorable President against the decisions of the Mohtasib.
The President in his decision observed that the banks were given ample opportunity to defend and controvert the claims of the complainants, however, they failed to provide any justification to upset the orders of the Mohtasib.
“The Banks failed to discharge their duty and the legal responsibility cast upon them under the law”, the President noted while rejecting the appeals as being devoid of any merit.
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President Alvi rejects MCB Bank’s appeal in fraud case
ISLAMABAD: President of Pakistan, Dr. Arif Alvi has rejected an appeal filed by MCB Bank against a decision by the Banking Mohtasib (Ombudsman) in a case where a banking customer lost huge money due to fraudulent activity.
President Dr Arif Alvi has upheld the decision of the Banking Mohtasib directing a private bank to credit the lost amount of Rs 800,000 (eight hundred thousand rupees) to the account of bank fraud victim.
While rejecting the representation of the bank against the decision of the Mohtasib, he observed that the bank was at fault for having incorporated the wrong contact numbers of the account holder in the bank system, thereby, preventing the complainant from taking any remedial step to avert the loss after receiving SMS alerts about the fraudulent transactions.
As per the details, Ms. Naveera (the complainant) had been maintaining an account with Muslim Commercial Bank’s (MCB) Gulshan-e-Ravi Branch, Lahore. She had to lose her money after her account was debited by using an ATM Card at four different ATM terminals.
She claimed that those transactions were unauthorized as those had not been conducted by her and the ATM Card was throughout in her possession. She also reported that no SMS alerts about the withdrawal of funds were conveyed to her except one received on 24-01-2019 intimating the withdrawal of Rs 200,000 from her account.
On receiving the SMS, she lodged a complaint with the bank, however, she was not provided with any relief. Subsequently, she approached the Banking Mohtasib to get a refund of Rs 800,000 withdrawn from her account fraudulently.
The Banking Mohtasib in its decision observed that additional contact numbers of the complainant had been added in the bank’s record without any authorization from the account holder, therefore, SMS regarding cash withdrawal transactions could not be received by the complainant.
Moreover, the bank had changed her PIN Code on 21.01.2019, just three days before the transactions, after receiving a phone call from an imposter as the Phone Banking Officer did not probe the caller.
The bank admitted during the hearing that the voice of the caller was different from the voice of the lady complainant. Additionally, the legible CCTV footage and snapshots of disputed transactions with date and time were not visible as the bank was found negligent to implement the State Bank of Pakistan’s guidelines regarding the installation of cameras in ATM cabins/rooms to have secondary evidence and to monitor all activities in the ATM vicinity.
The Mohtasib in its decision stated that the bank was under obligation to prove with cogent reasonable evidence that transactions were conducted by the complainant or were conducted by any person under her mandate.
The Ombudsman, therefore, ordered the bank to make good the loss by crediting the account of the complainant with a sum of Rs 800,000.
Later, the bank filed a representation with the Honorable President, which he rejected observing that the bank miserably failed to fulfil its statutory liability and rebut the claim of the complainant by failing to provide any justification to set aside the orders of the Banking Ombudsman. He noted that as per the law, the Banking Mohtasib is to inquire into the complaints about banking malpractices, maladministration, wrongdoings, fraudulent transactions, the corrupt and mala fide practices by the bank officials and pass appropriate orders on conclusion of the inquiry.
The President rejected the representation of the private bank as no fault could be found with the Banking Mohtasib’s approach to the matter.