1. The complainant gave an instruction to her investment Banker to close her investment account and transfer the funds to her cheque account. Once the investment account was closed, the account was then handed over to the complainant’s private Banker who managed the complainant’s transactional account.


The Banker could not open the transfer instruction and informed the complainant to send the instruction to another Banker. Unbeknown to all parties, the emails were intercepted, and the second Banker received “fraudulent” Banking details. The Bank then processed the payment to the “fraudulent” Banking details.


A few days later it became clear to all parties that emails had been intercepted and the Bank had been provided with incorrect Banking details. The Bank had therefore paid the money to an incorrect account.


It was argued by the Bank that the complainant’s emails were intercepted and as such there was no fault on their part, which meant that they should not be held responsible. Our investigation of the matter ascertained that when the email instruction was received from the complainant to pay the funds into the cheque account, there was no signed email indemnity on the file which authorized the Bank to act on an email instruction. Furthermore, the first Banker received the correct instruction: due to her inability to open the email, the complainant was asked to resend the instruction to another Banker, who then received the intercepted email. We also note that prior to the email instruction the complainant alerted her Bank that she received a scam email in relation to email spoofing and change of Banking details scam and that they should be aware of potential scams.


It is the view of our courts that:


It is the duty of the payee/depositor to ensure that they are paying the correct recipient. If a depositor/ payee makes a payment and the funds are credited to an incorrect account, whether as a result of a change of Banking details scam or incorrect account number entered, then the depositor/payee has not fulfilled his/ her obligations to the correct beneficiary.


It is irrelevant whether there was a change of Banking details “scam” or not. The depositor’s claim in this regard will be against the “fraudulent” beneficiary.


In light of the above, it was our recommendation that without proof from the Bank that they had paid the correct beneficiary, they had not fulfilled their obligations towards the complainant. This line of reasoning is in line with the view of our courts in respect of such matters.


The Bank agreed to refund the complainant her full financial loss of R2 million.


Principle: Banks need to ensure that they have the necessary mandate in place prior to taking an instruction from a customer. Furthermore, a Bank must ensure that it aligns itself with the position of our courts when investigating/assessing a matter.

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