Case Background
Our firm represented a Peruvian client (Plaintiff) in a lawsuit against China JS Bank Tianhe Branch concerning debit card fraud. On December 15, 2014, RMB 55,252 was fraudulently withdrawn from the Plaintiff’s card in Zhangjiagang, Jiangsu Province. The bank argued the client was fully liable for disclosing the password. We successfully demonstrated security flaws in the bank’s system and secured compensation with 80% liability attributed to the bank.
Case Challenges
1. Cross-border Evidence Barriers
- The bank refused to provide customer service recordings and ATM surveillance footage.
- The fraud location (Zhangjiagang) was 2000 km from the client’s location (Guangzhou).
2. Liability Apportionment Dispute
- Bank’s Argument: Password disclosure meant full client liability.
- Client’s Argument: Fraudulent card transactions exposed system defects.
3. Dispute over Timeliness of Card Suspension
- Overlap between the last fraudulent transaction (00:15-00:19) and the card suspension call time (00:16:57).
- Bank claimed “network delay” as grounds for exemption.
Our Service Highlights
1. Rigorous Demonstration of System Defects
- Invoked Article 107 of the Contract Law: Fraudulent card passing UnionPay verification exposed authentication flaws.
- Reversal of burden of proof: Bank failed its obligation to preserve surveillance footage (Article 6 of the Commercial Bank Law).
2. Precise Allocation of Password Liability
- Acknowledged secondary liability (20%) for possible password disclosure.
- Refuted the “password-only doctrine”: Both fraudulent card andpassword are essential prerequisites.
3. Breakthrough on Suspension Timeliness
- Exposed system vulnerability: Fraud occurred aftersuspension request. Failure to withdraw remaining RMB 8,820 evidenced operational delay.
Case Outcome
1. Core Victory
- Bank held 80% liable (compensation: RMB 44,201.6).
- Claim for interest (calculated from the date of fraud) supported.
2. Procedural Cost Transfer
- Bank bore RMB 905 of the RMB 1,180 case acceptance fee.
3. Landmark Rule Establishment
- Set a judicial standard of “70-30 liability split for fraudulent card fraud” (primary liability for system defects / secondary for password).
- Clarified burden of proof allocation in card suspension timeliness disputes.
4. Industry Impact
- Prompted banks to upgrade ATM fraudulent card identification systems.
- Provided a model for financial rights protection by foreign nationals.
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