Banks Held Accountable in Digital Arrest Scams: A Landmark NCDRC Case

The National Consumer Disputes Redressal Commission (NCDRC) has issued notices to several banks for alleged "deficiencies in service" in relation to digital arrest scams. The cases, which concern victims who lost large sums of money, have been clubbed and are being heard by a bench led by Justice A P Sahi and Bharatkumar Pandya. The NCDRC may invoke the assistance of government agencies like the Financial Intelligence Unit and Indian Cyber Crime Coordination Centre if it deems the complaints "maintainable." The next hearing is scheduled for November 14, 2025.

Title: NCDRC Issues Notices to Banks Over Alleged Deficiencies in Digital Arrest Scams

The National Consumer Disputes Redressal Commission (NCDRC) has taken a significant step in addressing the growing issue of digital arrest scams by issuing notices to several banks for alleged "deficiencies in service." The move comes as part of ongoing proceedings involving victims who have lost substantial sums of money due to these scams.

The NCDRC bench, led by Justice (retired) AP Sahi and member Bharatkumar Pandya, has admitted petitions filed by digital arrest victims and is currently examining the allegations against the banks. The commission has indicated that it may seek assistance from government agencies such as the Financial Intelligence Unit (FIU) and the Home Ministry's Indian Cyber Crime Coordination Centre (I4C) if the complaints are deemed "maintainable" [2].

The cases, which involve victims from Gurugram and Mumbai, were clubbed together for the NCDRC case. The bench has sent notices to a range of banks, including ICICI Bank, HDFC Bank, UCO Bank, Federal Bank, Sreenivasa Padmavathi Bank, Yes Bank, State Bank of India, and Kotak Mahindra Bank [2].

The NCDRC's March 3 order highlighted the allegations of compromised customer diligence and the violation of Reserve Bank of India (RBI) guidelines. The commission noted that the banks failed to take necessary precautions and raise alerts for suspicious transactions, leading to significant losses for the victims [2].

The next hearing is scheduled for November 14, 2025, and the commission is expected to delve into the specific allegations against the banks. The case underscores the need for robust regulatory oversight and customer protection measures in the banking sector.

References
[1] https://finance.yahoo.com/news/indian-crypto-exchange-coindcx-denies-202922326.html
[2] https://indianexpress.com/article/india/digital-arrest-scam-consumer-panel-sends-notices-to-banks-flags-service-deficiencies-10124565/