Fraudulent transactions
I have had a gold Citibank credit card for over five years. In December, 2008 my card was stolen and over Dh10,000 of fraudulent transactions took place within 48 hours. As soon as I realised my card was stolen I immediately reported it to Citibank and the card was blocked. I was advised to complete a fraud claim, which I submitted in January, 2009 and the case was investigated. We finally received a response from Citibank in May, 2009, accepting that the card was used fraudulently. They sent us a copy of all the transaction receipts and the signatures were clearly different to that on my card in each of the nine transactions. However, Citibank refused to refund the amount as they claim that the cardholder is responsible for all transactions that take place until it is reported stolen. Isn’t it the duty of the retailers to check signatures and Citibank’s responsibility to enforce it? How many cardholders are aware that they are liable for all transactions if their card is stolen until they realise and report it?
From Mr Tim and Ms Julia Rose
Dubai

Mr Karim Saif Al Deen, head of corporate affairs, Citibank, responds:
The Dh10,290 worth of transactions made on the stolen card were made prior to instructing the bank to block the card. The said card was reported stolen on December 17, 2008 and the disputed transactions were posted on the card on December 11 and December 12, 2008. Once informed, the stolen card was blocked immediately and a replacement card was issued. As with all prevailing practices by banks within the UAE, once a card is lost or stolen, the card member must report the loss or theft immediately and any transaction that occurs before the report is made remains the liability of the card member.

In view of the above, Mr Tim and Ms Julia Rose remain liable to the said transactions and are free to discuss with us directly as well. Our terms and conditions are provided as a part of the welcome pack and are available on our website www.citibank.ae.

Mr Tim and Ms Julia Rose respond: Each time we contacted Citibank about this dispute we got the same message “once a card is lost or stolen, the card member must report the loss or theft immediately and any transaction that occurs before the report is made remains the liability of the card member.” However they fail to answer our key question shouldn’t retailers check signatures? One of the transactions made was for over Dh4,000 and the signature used was clearly not checked as it did not resemble Julia’s signature at all.

Most people who have had their credit card stolen would not immediately realise it is missing. It takes a few minutes for somebody to make fraudulent transactions. To protect cardholders during this period, retailers should be checking signatures. Why is Citibank not enforcing that retailers check signatures on credit card transactions, as it is a standard procedure in most countries?

Mr Saif Al Deen responds: A Cardmember is required to report his/her credit card as having been lost or stolen immediately to enable us to block its unauthorised usage. A Cardmember remains liable for the transactions until such point. This is also represented in the Citibank General Terms and Conditions, which govern the usage of the Citibank Credit Card(s). A Cardmember agrees to abide by the Citibank General Terms and Conditions at the time of seeking a credit card facility. Furthermore, this is the standard procedure adhered to by other credit card providers in the UAE and is not a practice followed exclusively by Citibank.

With respect to the recommendation on having retail outlets carry out signature verification, you will appreciate that this process is followed on a best effort basis given that the entities under reference are not formally trained on detecting signature mismatches. Besides, a Cardmember’s signature on the strip appearing on the reverse side of the credit card may differ from what is available in our records and as such, Citibank, in its capacity as issuer bank, cannot ensure or enforce signature verification at a retail outlet. Be that as it may, it would be impossible to determine, in instances where a credit card is allegedly lost/stolen, that the signature on the card did not match the transaction slip.

Notwithstanding the aforementioned, please note that Cardmembers have the option to procure Secure Wallet Insurance which provides coverage in respect of fraudulent transactions up to 48 hours starting from the first such transaction. However, the said coverage needs to be explicitly subscribed to by a Cardmember in order to avail benefits arising from it. Finally, I would like to express to you and Gulf News our appreciation for giving us the opportunity to further clarify and explain to our Cardmembers as well as your readers at large the various provisions and responsibilities relating to credit cards.

Mr Tim and Ms Julia Rose respond: Upon being aware the card was stolen, we immediately reported it to Citibank, therefore complying with their requirements and of course protecting our interests, too. We cannot see why it is impossible for a retailer to determine that the signature on the card does not match the transaction slip. In this particular case there were obvious variances to the signature on the card as these transaction slips have been made available. In any other established part of the world where Citibank operates, when you sign for your transaction the signature is checked to prevent fraud. What is the point of signing the credit card at all if Citibank will not police the use of it?

The claim from Citibank that they cannot enforce checking because the Cardmember’s signature on the card may vary from what is on record is a weak excuse. Obviously any Cardmember looking to protect their interests would sign the card accurately.
Until banks make an effort to enforce signature verification, fraudulent use of credit cards will continue and be at the expense of cardholders. It is obvious that Citibank does not place enough importance or resources on protecting the rights of their Cardmembers they would just prefer you take out an additional insurance so that they can make money from the problem.

Mr Saif Al Deen responds: As we have previously laid out our response, we are unfortunately unable to provide further feedback. The case stands closed from our side based on the response sent earlier.