By AZE.US
An online loan taken out in someone’s name without their knowledge is not automatically canceled because fraud occurred. But whether that person must repay it depends on the circumstances of the case, Azerbaijan’s Supreme Court has explained.
The court said evidence of fraud alone is insufficient to invalidate a loan agreement. Judges must consider how the bank verified the borrower’s identity, whether it followed the law, what the customer did and the other evidence presented.
Banks may use electronic signatures, video calls, facial recognition and one-time confirmation codes, known as OTP codes, to issue loans remotely. In some cases, fraudsters obtain a person’s details, arrange a loan in their name and transfer the money to themselves.
The court also noted cases in which customers shared confirmation codes or access to banking apps with someone else. Such details matter when a dispute reaches court.
If a loan agreement was lawfully concluded but another person obtained the money through deception, a dispute between the bank and the named borrower is decided in civil court.
Should the court rule for the lender, the person harmed by the fraud can seek compensation from the perpetrator.
Anyone who discovers a loan they did not knowingly take out should promptly notify the bank and report the matter to law enforcement. Bank alerts and records showing how the application was approved and where the money went may be important evidence.
The Supreme Court of Azerbaijan advises customers never to share SMS codes, banking app credentials or identity documents with others.
AZE.US