UAE bank to pay Dh9.5 million to a customer after sim card swap scam

A UAE-based bank will have to pay Dh9.5 million to a customer who was cheated out of his money in a SIM card swap scam, the Dubai Court of Cassation ruled.

A UAE-based bank will have to pay Dh9.5 million to a customer who was cheated out of his money in a SIM card swap scam, the Dubai Court of Cassation ruled.

In February, the verdict overlooked an initial judgment by the Dubai Commercial Court of First Instance in May 2021, which discovered the bank and a local telecommunication company together and collectively responsible for the fraud.

Advertisement

In April 2015, the victim of the scam (a customer of the bank), whose personal details were not disclosed, gave his brother a power of attorney to manage all bank payments on his behalf.

In October 2018, the customer’s brother got to know that Dh9.5 million were transferred from the account within the last 32 days between August and September of 2018. The customer nor his brother were being informed of these payments. 

Ghassan El Daye, Partner and Head of Litigation Middle East at Charles Russell Speechlys, who represented the telecommunications service provider, “The payment was taken out on 49 different transactions using the phone banking app and digital services, leaving only Dh36 in the bank account.”

The customer further noticed that his mobile phone service was also suspended during the same month. 

After that, the investigations indicated that fraudsters had presented a replacement SIM card request to the telecommunication company of the victim’s mobile number that was recorded with the bank.

The final judgement found the bank guilty after the communication service provider demanded the initial ruling.

Advertisement

In the telecommunication company’s defence, El Daye mentioned Article 284 of the UAE Federal Civil Transactions Code to persuade the court to accept that the telecommunications company was not responsible for the scam by swapping the sim card. 

If any fault happens, the labiality of the bank from where the money was robbed replaces the liability of the telecommunication service provider.

According to Article 284, if the damage is both immediate and consequential, the rules connecting to direct harm shall apply.

In its verdict, the Court of Cassation said the transactions would not have occurred if the client’s personal details were not leaked.

“Being under the golden category which deals with accounts with big sums of money, the customer’s account should have been inactive after no payments were made on it for 28 consecutive months,” the ruling read.

The final ruling also said the bank was liable for the customer’s economic loss after it failed to use a robust authentication system.

SIM swap fraud:- 

It is a type of an account takeover in which fraudsters collect personal details to get a new SIM card administered in the customer’s name.

The scammer will get all the personal data they require, including OTPs, to conduct fraudulent dealings from the customer’s bank accounts using the SIM card.

Tariq Saeed

Read More

Ras Al Khaimah to Host New Year’s Eve Festival with Music, Fireworks, and Camping Options

The RAK NYE Festival promises a lively mix of entertainment, food, and spectacular fireworks, with free entry for all attendees. However, certain activities, food, and beverages will come at an additional cost

Six Injured in Four-Vehicle Collision on Emirates Road in Sharjah, Police Cite Speeding and Distractions

Preliminary investigations by the Sharjah Police have attributed the collision to speeding and distracted driving. The pile-up unfolded as one vehicle, reportedly traveling over the speed limit, failed to recognize a dense traffic build-up ahead

Cristiano Ronaldo Hints at Retirement Date During Dubai Globe Soccer Awards

The Portuguese superstar, known for his illustrious career with clubs like Real Madrid and Manchester United, left the audience in suspense as he jokingly mentioned the looming end of his football journey

Recent

Dubai grabs first position in attracting foreign investment projects in 2021

Dubai bagged the first position in the world in attracting foreign investment projects last year and grabbed the second position in attracting corporate headquarters as the economy of the emirate continues to recover from the Covid-19 pandemic.

Philip J Pierre Attends COP in Dubai

Philip J. Pierre Prime Minister of Saint Lucia attended the 28th COP (Conference of Parties) summit held in Dubai to discuss climate change.

Sharjah’s New Power Plant Strengthens Grid, Ensures Reliable Summer Supply

Equipped with advanced 33/11 kV technology, the plant is designed to improve efficiency and accommodate the increasing number of residential and commercial properties in the area
admin