Fraudulent KYC Link Costs Couple Dearly; SBI to Pay ₹1.35 Lakh

In Kerala, ₹3.28 lakh was siphoned off from an SBI customer's Fixed Deposit (FD) via a fraudulent KYC link. The commission has ordered the bank to refund the remaining ₹99,874, pay ₹25,000 in compensation, and cover ₹10,000 in litigation costs. The payment must be made within 45 days.

A message regarding a KYC update could jeopardize your hard-earned savings. A similar incident occurred with a couple in Kerala, where lakhs of rupees were allegedly withdrawn from their bank account through a fraudulent link. The Consumer Commission has now directed the State Bank of India (SBI) to refund the outstanding amount and pay compensation.

The incident dates back to 2023; a couple from Kerala held a savings account with the State Bank of India. The husband had also opened a Fixed Deposit (FD) of ₹10 lakh with the bank for a three-month tenure. On January 7, 2023, when he attempted to pay his credit card bill via the bank's app, the transaction failed.

Subsequently, he received a message stating that his account had been blocked and a KYC update was required. According to the husband, he attempted to enter his details using the link provided in the message. During this process, approximately ₹3.28 lakh was withdrawn from his FD across four separate transactions.

Bank Refunded Part of the Money, but a Balance Remained

The couple stated that they had immediately informed the bank about the unauthorized withdrawals. Following the intervention of the bank's internal banking ombudsman, approximately ₹2.24 lakh was refunded, but the remaining balance of ₹99,874 was not returned. The couple then filed a complaint with the District Consumer Disputes Redressal Commission in Pathanamthitta. They alleged that had the bank's monitoring system been effective, such unauthorized withdrawals could have been prevented.

Bank Accuses Customer of Negligence

During the hearing, SBI stated that it does not ask customers to update their KYC via an app. The bank argued that the customer had shared their details and OTP on a fraudulent link, thereby enabling fraudsters to carry out the transaction. However, the Commission found that the bank failed to present sufficient evidence to support its claim. According to the Commission, the bank cannot evade its responsibility merely by accusing the customer of sharing information.

SBI Must Pay Compensation Within 45 Days

The District Consumer Commission ordered the bank to refund the outstanding amount of ₹99,874. Additionally, the bank was directed to pay ₹25,000 as compensation for mental agony and ₹10,000 towards litigation costs to the couple. In total, the bank is required to make a payment of approximately ₹1.35 lakh within 45 days.

What is the Key Lesson for Customers?

This case highlights the risks associated with trusting unknown links received under the guise of KYC updates. Customers should verify information only through the bank's official website or app. Never share OTPs, PINs, or banking passwords with anyone. In the event of a suspicious transaction, immediately inform the bank and lodge a complaint with the cybercrime helpline at 1930.