Dubai Court holds bank liable in SIM swap fraud case
Dubai: A judgement in Dubai holding a bank liable in a SIM swap fraud case and ordering it to compensate a customer has become a legal precedent for all cases of a similar nature.
After being announced by the Dubai Commercial Court in July
2019, the local bank petitioned against the verdict in the Dubai Court of
Appeal. However, the Dubai Court of Appeal’s verdict became final, after the
bank chose not to pursue the case with the Dubai Court of Cassation. Found
legally responsible for the loss of Dh4.7 million in the SIM card swap fraud,
the bank had paid its customer Dh5.6 million through a Dubai execution judge
last month.
The amount included a nine per cent interest calculated from
the date the case was lodged and an additional Dh100,000 in compensation.
“We will see a new era for banking in the UAE after this
judgement has become final, irrevocable and not subject to any further appeal,”
said Ghassan El Daye, partner and head of litigation for the Middle East with
the UK-based law firm Charles Russell Speechlys.
“This judgement addresses the contractual and tortious
liability of a bank towards protecting its customers’ private data and records;
a liability that extends to the bank’s responsibility for the acts and
omissions of its employees,” he said.
El Daye believes banks will exercise strict measures in
verifying identities of their customers and running background checks on their
employees.
The case dates back to July 2017 when the bank’s customer
was emptied of his life savings. A bank employee provided the client’s personal
details and official documents to an unknown person who then used them to get a
replacement SIM card in the client’s name.
The replacement SIM card was then used to change the PIN
code connected to the man’s bank services before emptying his account.
A criminal report with the police had not helped recover the
stolen cash following which a civil case was filed with the commercial court
which then issued what has become a legal precedent.
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