CYTT News
[12/03/2011] Are you liable for money lost in the case of card pin fraud?
The Banking code states that in the case of a card fraud, the consumers are not liable for the losses unless they have acted negligently and even in that case, the burden to prove that they have acted negligently lies within the bank. However, approximately 2.5% of the victims of card fraud in the UK are not reimbursed by their banks and many see this as an unfair practice.
Each case is looked into individually by the banks securities experts and if money is withdrawn with the genuine card and the customer’s PIN code is used by the fraudsters, the bank might decide not to reimburse the card user. These are often the cases, where the clients have their cards stolen and were negligent enough to have the PIN code either written on the back of the card, or on a piece of paper that they carry together with the card. Similar scenario is seen when card users are revealing their PIN codes and give their cards to friends or acquaintances, who are then using the cards to make unauthorized purchases or withdraw cash from the ATMs. However, some clients that have had their wallets and cards stolen did not have the PIN codes written anywhere and yet the thieves managed to use the stolen cards with the correct PIN code. According to some, these are well-organized criminals, who might be working together with bank employees, but the banks claim that the PIN codes are known by customers only and records of these numbers are not kept at the banks. New European regulations, which are about to be introduced in the UK soon are clear that even if the original (and not cloned) card has been used along with the correct PIN code, this alone is no ground for refusing reimbursement.
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