Have you lost money from your account due to your own mistake? The bank cannot simply refuse to refund
There is an ongoing dispute between banks and customers – and the Office of Competition and Consumer Protection has taken action in this matter – whether financial institutions must return money to customers within one business day when they clearly violated security rules and allowed themselves to be robbed by thieves. Banks sometimes argue that they are an intermediary.
See also: Banks are supposed to return money to customers. “It's not a matter of discretion. It's the law.”
The Court of Justice of the European Union dealt with a similar case. The case concerned a client of a Polish bank who was a victim of fraud during a transaction on an auction website. The fraudster pretended to be a buyer and sent her a fake link imitating her bank's website, where the woman provided her login details. The fraudster took advantage of this by making a withdrawal from the client's bank account.
The next day, the defrauded person informed her bank about the unauthorized transaction and demanded a refund. However, he refused, explaining that the client had committed gross negligence by disclosing her bank details.
The case was brought to a Polish court, which referred it to the CJEU with the question whether, in accordance with EU law, in such a situation the bank can actually refuse or whether it is obliged to return the extorted money.
The CJEU spokesman spoke on the issue of fraudulent transactions
According to the Advocate General of the CJEU, Athanasios Rantos, the bank – in accordance with EU law – should react immediately by refunding the client the amount of the unauthorized transaction, unless it has evidence that she is trying to extort money. In such a situation, however, the bank is obliged to notify the relevant national authorities in writing.
However, as the spokesman emphasized, this refund is not final. If the bank actually determines that the unauthorized transaction was the result of the customer's fault who intentionally or as a result of gross negligence disclosed his account credentials, the bank may ask him to cover the losses. If the customer refuses, the bank has the right to initiate legal proceedings against him, to get back the payment. As we wrote recently in Business Insider, Polish banks bring such proceedings against their clients.
Opinions of the CJEU advocates general precede the tribunal's judgments, constituting proposals for a solution. Judges usually uphold the position adopted by the advocates, but this is not binding.
