The Bombay High Court directed HDFC Bank to refund ₹38.04 lakh to a Pune businessman who lost money in a SIM-swapping cyber fraud, holding the customer not negligent.
The Bombay High Court has ordered HDFC Bank to reimburse ₹38.04 lakh to a Pune-based businessman who was defrauded through a SIM-swapping cyber fraud.
The division bench held that the victim, Subodh Korde, was not negligent and had not shared any passwords or OTPs, rejecting the bank’s claim that SMS alerts were sufficient proof of due process. The court observed that fraudsters used SIM cloning/swapping techniques to gain control of the victim’s mobile number and carry out unauthorized transactions, including adding beneficiaries and transferring funds within minutes.
The judgment emphasized that under RBI’s customer liability framework, the customer qualified for “zero liability” since he promptly reported the fraud and did not contribute to the unauthorized transactions. The court also noted inconsistencies in IP address logs, which showed transactions originating from locations different from the customer’s usual activity, further supporting the claim of fraud.
The bench criticized the bank for relying only on system logs and failing to prove that alerts or OTPs were actually received by the customer. It concluded that the bank could not shift responsibility onto the customer in cases involving sophisticated cyber fraud techniques like SIM swapping.
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