Compromised Credit Card - Unauthorised Retail Transactions


Madam E discovered upon receiving a letter from Bank D on 4/10/2016 that there were twelve unauthorized retail transactions totalling RM629.60 performed using her credit card at various petrol stations from 25/8/2016 until 4/10/2016. Madam E reported the matter to Bank D and lodged a police report on 5/10/2016. Madam E’s credit card which carries expiry date 04/2019 was in her possession at all times. Madam E contended that she did not authorize any of the said transactions and that she should not be held liable on the total disputed amount of RM629.60.


Investigation and Findings

Madam E lodged a report on 4/10/2016 with Bank D disputing the unauthorized transactions and her credit card was immediately blocked.

Bank D stated that the alleged unauthorised transactions were transacted at the self-service fuel  dispenser terminals whereby no signature is required. The transactions were performed with the presence of Madam E’s new credit card with expiry date 04/2022 and the transactions were authorized upon validation of the said new credit card.

In April 2016, Bank D had replaced Madam E’s existing credit card (expiry date 04/2019) to the new  PIN enabled credit card bearing the same credit card number but with a new expiry date of 04/2022. The said new credit card was sent to Madam E’s address registered in Bank D’s system via normal mail and the card was activated via IVR (interactive voice response system) by Madam E on 2/5/2016.

Bank D’s record also showed that the said new credit card was not reported lost or stolen during the incident period of time. There were four similar transactions at petrol station performed earlier using the same new credit card (expiry date 04/2022) between 9/5/2016 until 19/8/2016 but the transactions were not disputed by Madam E.

Bank D was merely acting as a billing agent. In view of this, all the disputed transactions were deemed valid. Thus, Bank D held Madam E fully liable on the total disputed amount.  



During mediation session, the Case Manager found that Madam E has in her possession the old credit card which carries expiry date 04/2019. However, the new PIN enabled credit card that was activated by Madam E was not in her possession. Thus, Madam E has failed to safeguard her new credit card and delayed in reporting the loss of the new credit card to Bank D.  Madam E accepted the findings and agreed to pay the disputed amount in two instalments. Bank D agreed to waive all interests and late payment charges incurred on the total disputed amount.