Ombudsman issues advice over card use

A man who lost $30,000 from his bank account after someone watched him enter his pin number in a bar is being used as an example of the need to take care with cards this summer.

Banking Ombudsman Nicola Sladden said it was important that people were cautious while out shopping, and holidaying, as well as being careful of online scams.

She pointed to the case of the man, who was away from home for business and used a non-bank card to buy drinks at a bar. The person who watched him enter his pin number guessed that he used the same pin on other cards and went on to spend $30,000 on his bank card.

At first, the bank would not compensate him because it said he had disclosed his pin and contributed to the loss. He took his complaint to the ombudsman earlier this year.

Sladden’s office didn’t agree with the bank – she said he did not know he was being watched and had taken reasonable care. He was reimbursed plus interest.

Sladden said people should not let their guard down when they unwound over the summer break and should shield their pin numbers when they entered them.

‘‘If your card goes missing, contact your bank immediately. Under the Code of Banking Practice, banks must compensate customers for unauthorised transactions unless customers have breached the terms and conditions of their card, or they haven’t taken reasonable steps to protect their banking details.’’

Complaints about cards made up 13 per cent of total cases referred to the Banking Ombudsman last year.

Anyone making the most of Boxing Day and new year online sales should also be wary of scammers, she said.

‘‘Scam complaints are on the rise,’’ Sladden said. ‘‘Last year we received over 370 complaints about scams and fraud, and that’s just the tip of the iceberg. When shopping online, only use your card on trusted sites. Beware of random texts, such as the bogus package delivery text, or emails asking for login details, pins or passwords. Before clicking links, stop and think, is this for real?’’

If you’re using your downtime to make new connections or seek out investment opportunities, take extra care.

While banks have a general obligation to reimburse customers for fraud from unauthorised transactions, sometimes customers authorise payments that they later regret.