HDFC Bank Ordered to Refund ₹2.20 Lakh by Consumer Commission Over Fraud

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The District Consumer Disputes Redressal Commission, Chandigarh, ruled in favor of a senior citizen who fell victim to a cyber fraud scheme, mandating HDFC Bank to release a frozen sum of ₹2 lakh and provide an additional ₹20,000 as compensation and legal costs.

Ruling Details

The decision, issued on June 9, highlighted the bank’s failure to address the victim’s requests promptly despite clear evidence of fraudulent activity.

Complainant’s Actions

The complainant, Balwinder Singh, reported receiving a call on April 3, 2024, from individuals posing as law enforcement officers. They claimed his son was detained in a narcotics-related case and persuaded him to transfer ₹2 lakh to an HDFC Bank account.

Bank’s Failure to Act

After contacting his son and confirming his safety, Singh immediately froze the transaction at an HDFC branch and filed a police complaint. He also submitted a copy of the police report to the bank. Despite these actions, the bank did not return the funds despite multiple written requests and in-person visits.

Commission’s Decision

The case was escalated to the Consumer Commission, which noted the bank’s failure to respond to formal notices. The Sector 22 branch of HDFC Bank did not appear during the proceedings, leading the commission to infer that the institution lacked a valid defense against the allegations.

Service Deficiency

The commission determined that retaining the funds without explanation constituted a service deficiency. It emphasized the victim’s repeated efforts to resolve the matter and the emotional and financial strain caused by the bank’s inaction.

Ruling Implications

The commission ordered the immediate release of the ₹2 lakh to Singh’s account and mandated a ₹20,000 payment for compensation and legal expenses. The ruling underscores the obligations of financial institutions to act swiftly in fraud cases and reinforces protections for victims of cybercrime.

Legal Consequences

The case highlights the legal consequences for entities that fail to address customer grievances promptly. It serves as a precedent for banks to prioritize customer safety and transparency in cyber fraud incidents.