Backlash for banks over missing cash

File picture: Motshwari Mofokeng

File picture: Motshwari Mofokeng

Published Sep 1, 2015

Share

Cape Town - The response of banks to allegations of card fraud and money being illegally withdrawn from clients’ bank accounts has come under the spotlight after an article published in the Cape Argus last month.

Cape Town journalist Yazeed Kamaldien complained of his three-month battle with Standard Bank when his bank card was cloned and R14 937.52 fraudulently withdrawn from his account.

Standard Bank had offered to pay him back 50 percent of what he lost. He refused, saying he would try other avenues to get his full refund.

The Cape Argus has since been inundated with similar complaints.

Grassy Park’s Bashir Mukuddem approached the Cape Argus for assistance after reading the report.

He said R37 000 was fraudulently withdrawn from his Standard Bank cheque account on July 29 at about 1pm.

Mukuddem said he reported the matter immediately to the Grassy Park branch manager who accompanied him to the Grassy Park police station where a case of cyber fraud was lodged. A case was also filed with Standard Bank’s fraud department.

“Thus far, an amount of R14 866.03 has been recovered by the fraud branch and the bank refuses to pay back the balance of R22 133.97, which has been stolen from my account. A bank is supposed to be a safe place for people’s savings,” he said.

Mukuddem said all he received from the bank since then was a message that he would not be paid.

Standard Bank spokesman Ross Linstrom said the bank had contacted Mukuddem on Monday, confirming that its investigation was still in progress and that he would be contacted shortly.

“Mr Mukuddem was satisfied with this feedback. Each of these cases is treated seriously and the details thoroughly investigated. In this matter, whilst we have managed to secure some of the victim’s funds, we are still in the process of investigating and finalising the matter. As such, no final decision has been made with regard to the outstanding loss thus far.”

Linstrom said the bank’s final outcome would be communicated directly with Mukuddem followed by written communication.

Helene Kesler, a former Capetonian now living in Joburg, said she lost R5 000 when separate amounts of R2 000 and R3 000 were withdrawn from her Absa account in July last year.

“Being a religious member of the orthodox Jewish faith, I do not do any business transactions nor interact with the outside world from sunset Friday to after sunset Saturday, which is our Sabbath. My debit card was in my handbag and I did not leave the house that day.”

As per normal, she only switched on her cellphone on the Sunday morning, and was shocked to see the two “Notify Me” messages indicating money had been withdrawn from her account the day before.

Kesler contacted the bank’s stop card division and spoke to a consultant who immediately placed “a stop” on her card. Kesler also used the opportunity to log a case with the bank.

However, more than a week later, she received an SMS from Absa, saying the money would not be refunded.

“I am most upset with this resolution. In fact, if you go through my account history (more than 25 years), you will not find a single transaction done by me on our Sabbath day,” she wrote to the bank.

Absa responded: “Although we sympathise with your loss, the bank cannot be held liable for any financial loss that you may have incurred as the disputed withdrawals were affected with your card and secret PIN number. The bank is prepared to refund you an amount of R1 250 as a goodwill gesture and not an admission of any liability.”

Kesler refused to accept the offer, and wants the full amount refunded. She is adamant no one had been in possession of her card and the incident had caused her distress.

Another client, who asked to be identified only by his first name, said all he received from Absa after more than R60 000 was withdrawn from his account was “a glass of water to calm him”.

Johan, of Brackenfell, told the Cape Argus R60 300 disappeared from his account in June, shortly after a policy had paid out.

His wife had contacted him at work on June 12 after receiving an SMS.

“She phoned me to ask what was going on, and I immediately called the helpline and was told they would forward me some forms to complete. I went to Absa’s Adderley Street branch when it opened and they offered me a glass of water for shock.”

Johan said he had done everything he was told to do, such as drawing a bank statement and opening a case at the police station, and was assured more than once that he would get his money back although “it would take a while”.

However, more than a month later he received an e-mail from Absa, saying his money would not be recovered.

“At this stage the matter is with the Ombudsman. We were very upset with the outcome and service as I had to drag information from Absa. My money is not safe there. I reported the fraud within an hour and had to wait months for a response.”

Kalyani Pillay, chief executive of the South African Banking Risk Info Centre (Sabric), said counterfeit card fraud was predominantly committed by skimming, one of the most common modus operandi for compromising card track data.

She said the banking industry lost R453.9 million last year through card fraud, which includes card skimming.

Karin van Rooyen, executive personal assistant to the Ombudsman for Banking Services, advocate Clive Pillay, said Kesler’s case was dealt with last year while Johan’s was still pending. She said the ombudsman’s office was still awaiting the bank’s response.

Van Rooyen said the office of the ombudsman investigates complaints by gathering all the relevant information and makes a decision after an assessment. She said the office had received 1 336 card complaints from January to last month and the average time to investigate a complaint depended on the complexity of the complaint.

“We finalise about 70 percent of our complaints within 32 days. We strive to finalise all our complaints within four months.”

An Absa spokesman, who asked not to be named, said the bank was aware of the two incidents and has been liaising with the customers involved.

“The bank finds both events regrettable, and has conducted thorough investigations into the disputes. In both cases, the findings were that the customers’ electronic banking credentials were compromised. Customers must also note that in some cases, fraudsters may obtain access credentials long before any attempt is made to defraud the account.”

Meanwhile, Yusuf Samuelson, of Tafelsig in Mitchells Plain, has taken issue with Standard Bank’s lack of security for clients making large withdrawals. He was followed home and robbed of the R20 000 cash the bank had loaned to him.

He said his brother-in-law had accompanied him into Standard Bank in early July to withdraw the amount the bank had loaned him. Samuelson said they were followed to their home by thieves who demanded the R20 000. They also stole his car.

After informing the bank, he was told he would still be liable for the repayment of the loan.

Take a tip

Kalyani Pillay, Sabric chief executive, offers tips on how bank consumers can avoid card skimming.

* Key in your PIN in such a way that no one else can see it – such as covering the keypad with your free hand when punching the numbers in – even when alone at the ATM, as some criminals may place secret cameras to observe your PIN.

* Set a daily withdrawal limit that suits your needs (the default amount is set at R1 000) to protect yourself in the event that your card and PIN arecompromised.

* Do not ask anyone to assist you at the ATM , not even the security guard monitoring the ATM or a bank official. Rather go into the bank for help.

* Do not insert your card if the screen layout is not familiar to you.

* If your card is retained, do not leave the ATM before you have cancelled your card by calling your bank’s call centre using your own cellphone.

Related Topics: