OTP frauds more prevalent in Ludhiana and Chandigarh: RBI ombudsman

If the OTP is shared by the customer, then he or she is solely responsible for the fraud.

An increased number of fraudulent transactions committed online are being reported from Ludhiana and Chandigarh, said JL Negi, chief general manager, banking ombudsman, RBI, Chandigarh, who was in the city to hold a public meeting.

The complaints of fraudulent transactions are received from all corners, but the number of such complaints from Ludhiana and Chandigarh surpass all other cities. (Representational photo)

Talking to HT, Negi said, “While it is an overall phenomenon that such frauds, wherein money is siphoned off from one’s bank account without the owners knowledge, are being reported, they have witnessed a disturbing trend particularly from these two cities.”

“We receive complaints of fraudulent transactions from all corners, but the number of such complaints from Ludhiana and Chandigarh surpass all other cities. In most of the cases, the customers share their OTPs (one time passwords) sent on their number with the callers who pose as bank officials,” Negi said.

“If the OTP is shared by the customer, then he or she is solely responsible for the fraud,” he added.

While addressing the public, Negi said that the liability of fraudulent transactions committed online is with the customer when he has deliberately shared his OTP with the caller.

Negi said that if a bank is found to be indulging in malpractices like asking financially illiterate customers to avail third party products of the bank like insurance policies and mutual funds, then the bank will be liable to pay the customer if a complaint is received. “If the bank tells a 70-year-old, who comes to make a fixed deposit, to avail of an insurance policy which she may benefit at the age of 110 years, then it is a clear case of fraud. If a complaint of such a kind is received wherein the bank forced a financially illiterate customer to avail a third party product, then the bank is liable to compensate the customer,” he said.