If your bank card is used fraudulently either because it has been cloned or stolen, don’t think the bank will refund you. Legally, if your PIN is used to withdraw money or carry out a transaction, the argument is that the only way it could happen is if you compromised your code. Therefore you, not the bank, are responsible.
According to the ombudsman for banking services, it is very difficult to prove that the customer was not negligent in protecting his or her PIN.
The problem is exacerbated by the fact that some people lie about their card being compromised or it turns out that a family member has used the card without permission.
One thing the bank will examine is the trail of transactions. If for example you used your card in Cape Town and 10 minutes later it is used in Johannesburg, then it was clearly a cloned card.
Criminals also try and withdraw all the funds available in one transaction. If your card is used to draw R500 one day and another R500 another day — all close to where you live — you will struggle to convince the bank that this is the work of a criminal.
If your card is compromised and you know that you have been vigilant, speak to your bank and if you are not happy with the outcome go to the ombudsman. But be aware that this is a very difficult case to prove because you still need to show that you did not compromise your PIN by proving information to a phishing scam, for example. The only way to protect yourself is to become hyper vigilant.
How to protect yourself
The problem with cloning is that often you are not aware that your card has been compromised. Cloning is when the criminal makes a copy of your card — in a few seconds — using a device the size of a matchbox.
ATM scams: Someone may offer to help you at the ATM, you feel uncomfortable and grab your card back. You walk off, confident that no card swapping has taken place, yet the criminal has already made a copy of your card after watching you key in your PIN. If you are ever approached at an ATM, report it immediately. If your account is accessed after you have reported it, the bank is liable.
Merchant scams: When you pay with your card, always cover the keypad with your other hand so that no one can watch. Restaurants in particular are places targeted by syndicates, so never let the card out of your site and again, do not let anyone see you enter your PIN.
SMS alerts: Some banks, such as Absa, have very good internal fraud detection measures which will trigger if they see a transaction taking place 10 minutes later in another city, but legally the banks do not have to detect this type of activity. The best protection is to sign up for your bank’s SMS alerts which notifies you the minute a transaction takes place. If you didn’t make the transaction, call your bank immediately.
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