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Are We Liable?
Sunday afternoon, they decided to go to the movies and then out to dinner.
The movie was great-so good, in fact that the woman sent her daughter back with her wallet to get some popcorn and soda, because she didn't want to leave the movie and go get it herself.
After the movie, she and her daughter went out to dinner. When the time came to pay the bill, she reached for her wallet. Gone! Now the daughter remembered, she laid it on the counter when she was in the movie theater, and never picked it up again!
They immediately backtracked to the theater. It was not there. They went home and started making calls to the credit card companies. Oh, yes…there was an ATM card in there too, so she called her financial institution about 9:00 p.m. on Sunday night.
The voice-mail response at their financial institution on Sunday evening directed them, if this was an emergency call due to a lost or stolen bank card, to call a certain number-which they did. That number answered on a machine, instructing them to leave the information about the card after the "beep." Which they did.
At 2:00 a.m. on Monday morning, the woman got a call back from a man saying he was the security officer of her financial institution. He informed her they had just recovered her bank card from an ATM, and wanted to reassure her that it had been found and would be returned to her immediately. In order to verify that it was hers, however, the caller needed her address, the correct spelling of her name…and her PIN!
The unsuspecting woman gave the caller all of the information requested…spelling her name, giving her address and then told him her Personal Identification Number (PIN).
At 2:30 a.m. a $300 withdrawal was made from an ATM.
TRUE STORY
The above scenario came to us from a banking institution that had this incident. Their question to BANKERS' HOTLINE was, "Is the financial institution totally liable for the loss?"
We checked with three different attorneys, and pass on their opinions to you. (They all agreed, by the way-a remarkable occurrence!)
Notification was received by the financial institution (by means of an answering machine) before the card was used. Therefore, even though the customer was 'negligent' in giving out her PIN, if the institution had taken proper action and "hot-carded" when they had been notified, it would have been impossible for the withdrawal to be made. The card would have been captured on the attempt. Therefore, the institution could be considered negligent because it did not take proper action to prevent the loss. The institution, in their opinions, would be liable.
Copyright © 1991 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 2, No. 1, 1/91
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