Money Fraudulently taken from Bank Account- What to do?

Nitish ChandanLaw

Statistically, plastic money frauds in India have seen troubling growth in the last decade. Headlines reporting fraudulent money withdrawals from ATM machines are an almost regular occurrence. On our helpline and from people inquisitive about the cyber law, we get to hear this question a lot.

Somebody withdrew money fraudulently from my bank account through an ATM. What do I do now?

While there is no defined legal recourse for this particular situation, there are a certain set of cases that have laid a little foundation for people to take action. First of all, we believe that most of the credit/debit card frauds happen due to lack of user awareness and use of obsolete technologies by the banks. The best thing to do first hand is to be aware while using plastic money online or offline for any type of transactions. The answer to “How to be aware?” is available in the hundreds of posts available on this website.

What type of action should you take?

There are basically two actions that you may take:

  1. Criminal Action: Using Sections 66C, 66D of the IT Act, 2000 and Section 420 of the Indian Penal Code, you can pursue a criminal action in order to get the law enforcement to find out the criminal. Often we have seen that this recourse doesn’t get a user’s money back or catch the criminal after all.
  2. Civil Action: This type of action can be pursued against your bank, the bank whose ATM money was withdrawn at or payment gateways, depending on different situations. We will look at Civil Action in detail here because that is what can get you your money back.


Where should I file a case?

Your first authority to reach out is the bank to inform them of the fraud. You can claim to get compensated if there is a precedent like your case available already. After that, you could file a complaint with the IT Adjudicator of your state or the State Consumer Forum. Both these bodies have given out orders to the tune of compensating the customers. In cases like Vidyawanti v. State Bank of India, Sudahanshu Karna v. Punjab National Bank, Amit Kumar Ghosh v. ICICI Bank, State Bank India v. KK. Bhalla and many others, these authorities have ruled in favor of the customers compensating them with interest on the lost money.

In 8.17.2 (p) of the Code of Bank’s Commitment to Customers, the extent of liability of a customer in case of a fraud on internet banking is stated. This is set at Rs. 10,000 which means that in any case of fraud over internet banking or plastic money being used online, the liability of the customer is only up to Rs. 10,000 and the rest is to be made good by the bank.

In (l) & (m), it has been stated again about the maximum liability in other transactions also i.e. for any loss that occurs before you notify your bank of a fraudulent transaction, the customer is only liable up to Rs. 10,000 with the exception that he is not committing fraud himself.

What do RBI Guidelines say?

RBI Guidelines device electronic banking frauds into two categories: one that requires ATM Card to be physically present, i.e. proximity transactions and one that does not require ATM Card physically i.e. Card Not Present (CNP) Transactions. For a better understanding of this, let’s call proximity transactions as ATM Frauds and CNP Transactions as Fraud Online Transactions.

ATM Frauds will include the scenario when money gets withdrawn from your card without your knowledge. This is possible as your card has been cloned or skimmed and the fraudster has the duplicate copy of your card. In cases of ATM Frauds, the liability rests with the bank to credit the lost amount after the internal investigation. (We will be doing a post on this shortly).

Fraud Online Transactions will include all such transactions when the caller represents himself as a bank officer, a government official, or from some lottery. Under this, incidents when the cardholder himself shares his sensitive card details under the impression that the caller is genuine, are covered. In Fraud Online Transactions, you should be proactive as the lost money can be traced with the help of payment service providers.

How to Get Help from Us? हमसे मदद कैसे प्राप्त करे?


In order to get help from us, please send all the relevant information about the incident at (हमसे सहायता प्राप्त करने के लिए घटना से जुड़ी हुई सभी जानकारी कृपया पर भेजें।

Disclaimer: Please note that we are not a law enforcement agency or a financial institution. We are an organization working solely to help the victims of cybercrimes. You are sharing the data with your express consent.

उद्घोषणा: कृपया ध्यान दें कि हम कानून प्रवर्तन एजेंसी (जैसे पुलिस) या वित्तीय संस्थान नहीं हैं। हम पूर्णतः साइबर अपराधों के शिकार लोगों की सहायता के लिए काम कर रहे हैं। आप अपनी व्यक्तिगत सहमति के साथ अपनी जानकारी हमारे साथ साझा कर रहे है |