Dhananjay Jog
The concept of credit cards originated when Frank McNamara, a senior World Bank official in the U.S., faced an embarrassing moment at a New York restaurant. Hosting a dinner for foreign dignitaries, he discovered at the end that he had forgotten his wallet. After seeing off his guests, he called his wife for help. This incident led to the creation of the first-ever credit card—the ‘Diner’s Club’ card. Restaurants were paid monthly by the card company, which earned a 2% commission on transactions. Initially meant only for dining, credit cards are now widely used for purchases and travel. (Incidentally, I was the Diner’s Club representative for Goa in the early ’80s.)
A credit card allows spending first and repaying later, with a monthly interest of 2–3%. In contrast, a debit card limits spending to the account balance. Since banks earn from transaction fees and annual charges, they aggressively market these cards—sometimes issuing them without customer requests. This practice can be risky. If the card is sent to someone who has moved, is on vacation, or is deceased, it can easily be misused.
This is exactly what happened to Joan Westfield (name changed), a British national whose husband Peter passed away in 2012. Joan and Peter had a joint savings account at ABC Bank, Margao. After Peter’s death, Joan returned to England and came back to India in 2016. To reactivate the dormant account, she deposited Rs 100 and informed the bank of Peter’s death.
Peter had earlier purchased two flats in Goa. However, after his death, FEMA (Foreign Exchange Management Act) regulations did not permit their transfer to Joan. So she sold them back to the builder and deposited over Rs 29 lakhs in the account. She later withdrew Rs 10 lakhs to settle dues and returned to England. A year later, she came back to find that Rs 19.78 lakh had been fraudulently withdrawn from the account over a period of three months.
The bank had issued a debit card in Peter’s name on 12/07/2016—over four years after his death—and sent it to the last known address. Joan had already designated an advocate as her local representative, yet the card was sent to neither. The fraud came to light only when Joan tried to access the account.
Her complaints to the bank went unanswered. She then filed a police complaint and approached the Consumer Commission. The bank responded with blanket denials—claiming Joan hadn’t notified them of Peter’s death or deposited Rs 29 lakh, both of which she proved with documents. It initially denied issuing the debit card but later admitted to it.
The bank also admitted to issuing cards without requests and mailing them to old addresses without verifying if the account holder was alive or still residing there. Their only defense was that the card and PIN were sent separately—an ineffective safeguard, as both could be intercepted by the same person.
The withdrawals—210 in total—were made between July and October 2016. Most were under Rs 10,000, spread across Goa, Panchkula, and Chandigarh, with 11 abroad. The steady, small withdrawals suggested the fraudster was confident of not being caught—likely knowing Joan was out of the country and that no alerts would
be sent.
Given the account’s dormant history and sudden spike in ATM withdrawals—three to four a day—a reasonable bank should have flagged the activity. Joan suspected two bank employees, whom she named in her complaint. Though the bank sent legal representation, these employees never appeared. But suspicion alone isn’t proof; the Consumer Commission isn’t an investigative body.
The bank should have conducted an internal probe and reported the matter to police. It failed to do so. Nor did it attempt to retrieve CCTV footage of ATM withdrawals, particularly the 199 made in India.
We directed the bank to pay Joan Rs 19,78,127 with 6% interest from the date of the first withdrawal, along with Rs 1,00,000 as compensation and Rs 10,000 in costs.
(If you have any questions, comments, or if you are a consumer seeking assistance, please feel free to email me at danjog@yahoo.com)
