The Supreme Court has clarified who bears responsibility for an online loan taken out by fraudsters
In recent years, as a result of the digitalization of banking services, online lending has become widespread.
This service allows citizens to obtain loans within a short time without visiting a bank, but at the same time it also gives rise to new legal risks.
The legislation of the Republic of Azerbaijan allows banks to open bank accounts and conclude loan agreements remotely. According to the Rules approved by the Central Bank of the Republic of Azerbaijan, when providing online services banks may use an enhanced electronic signature, video calls, video recording, facial recognition, one-time confirmation codes (OTP), and other means of identification.
Recent judicial practice shows that in some cases third parties, gaining access to citizens' personal data, take out online loans in their names and transfer the loan funds to their own accounts.
Practice demonstrates that sometimes citizens themselves hand over to other persons the one-time confirmation codes (OTP) sent to their mobile phones, the login details for their banking application, or undergo the facial recognition procedure at the request of strangers. This creates favorable conditions for fraudulent acts to be committed against them.
Many believe that, having become victims of fraud, they bear no legal responsibility for the loan debt. However, from a legal point of view, the situation looks different. Citizens also bear responsibility for ensuring the safekeeping of their personal data. In particular, every citizen is obliged not to hand over to outsiders their PIN code (FIN), identity card or a copy of it, SMS confirmation codes, banking application login details, biometric data (facial recognition, fingerprint, etc.) and to ensure their security.
The Supreme Court's recommendations are as follows:
- Do not hand over your PIN code (FIN), identity card or a copy of it to unknown persons;
- Ensure the security of your biometric data;
- Do not share SMS confirmation codes with anyone;
- Constantly monitor the bank notifications arriving on your phone;
- In the event of a change of mobile phone number, notify the bank immediately;
- Do not trust suspicious calls and messages;
- Check your bank accounts regularly;
- If a loan has been taken out in your name without your knowledge, immediately contact the bank and law enforcement agencies.
Online lending services are an integral part of modern banking. They require not only high security standards on the part of banks, but also careful attention from citizens to the protection of their personal data.
Judicial practice shows that the fact of fraud in itself is not a sufficient basis for declaring a loan agreement invalid. In each specific case, the court assesses the actions of the bank, its compliance with the requirements of the legislation, the actions of the citizen himself, and the entire body of evidence presented.
