A court in Shanghai ordered two banks to compensate a customer 37,611 yuan (US$4,531) yesterday after he suffered a loss as the lenders refused to freeze his account when he reported the card was lost.

Plaintiff Luo Gang said in the lawsuit that he applied for a Great Wall bankcard and a deposit book from the Changning District subbranch of the Bank of China in September.

On September 6, his briefcase containing a few bankcards, including the Great Wall card and his identification card, was stolen at a restaurant.

After reporting the theft to police, Luo called the banks and asked them to freeze his account.

When he called the 95566 service hot line of the Shanghai branch of the Bank of China, the bank refused to freeze his account. A customer service representative said Luo didn't have phone-bank service privileges.

As a result, 68,062 yuan was stolen from Luo's Great Wall account by the next morning.

Luo filed a lawsuit against the Changning subbranch and the Shanghai branch of the Bank of China to the Huangpu District People's Court, requesting the lenders cover his loss.

"The Changning subbranch didn't inform me when it issued the card that I must apply for phone-bank service in case I needed to freeze my bank accounts," Luo testified. "The Shanghai branch didn't deal with my report over the phone in time."

The banks argued they were not at fault because the phone-bank service was advertised on their Websites. Both also said Luo's carelessness resulted in the theft and subsequent loss.

Before Luo requested his account be frozen, 30,451 yuan had been withdrawn.

The court ruled the banks should protect capital, as well as inform and assist clients who establish a deposit contract. The Huangpu court subtracted the 30,451 yuan that was withdrawn before the theft was reported to reach the compensation amount of 37,611 yuan.

Source: Shanghai Daily News