Kotak Mahindra Bank scam alert! Amid RBI crackdown, customer ‘conned’ of ₹10k on account opening; money refunded

A Kotak Mahindra Bank customer took to the social media platform X to claim that he was ‘scammed’ and ‘conned’ by the private sector lender while trying to open a current account online.

Nikita Prasad
Published25 Apr 2024, 05:12 PM IST
Kotak Mahindra Bank has been barred by the RBI from onboarding new customers through its online portal and mobile app.
Kotak Mahindra Bank has been barred by the RBI from onboarding new customers through its online portal and mobile app.(Mint)

Amid the recent crackdown by the Reserve Bank of India (RBI) on Kotak Mahindra Bank's deficiencies and non-compliances in the IT system, a customer on Thursday took to social media platform ‘X’ to claim that he was ‘scammed’ and ‘conned’ by the private sector lender while trying to open a current account online.

The customer, Piyush Dewan, said he lost 10,000 during the process of opening an online current account with Kotak Mahindra Bank. Though the money was refunded after his tweets went viral, the bank had not reached out to him with an official communication over what went wrong in the initial stage.

Also Read: ‘Serious deficiencies’: Why RBI cracked whip on Kotak Mahindra Bank

Taking to X, Dewan said he was scammed by the online current account opening workflow of Kotak Mahindra Bank a week before yesterday's RBI action. In a series of tweets, he shed light on the problem faced by him, underscoring the ‘'gross inadequacy or leakages in Kotak Mahindra Bank’s system''.

Dewan wrote, “We initiated an online current account opening through the bank website on 18th Apr. Type Individual. We duly completed the online form except the last step of document upload (as didn't have them handy).”

As expected, he got an SMS from the bank for the completion of the process. On April 19, Dewan used the workflow (sent by the bank via SMS) to complete the document upload.

During the process, Dewan received an OTP confirmation to verify the mobile number and also got Aadhaar OTP twice. “There was no way that we could have smelled a rat at this stage,” he said.

As a next step, he was asked to seed this newly opened current account. He used UPI to transfer 10,000. “At this stage we were expecting some communication on screen, or email, or phone. We didn't receive any details for the newly opened account,” said Dewan.

After waiting for 4-5 days without receiving any confirmation from the bank, Dewan visited the bank branch. The branch employees were unable to find any records for his account, he alleged in his tweets.

“They tried using the PAN, the Adhaar number, mobile number and everything. The branch manager very casually told us that this could be fraud and made us write an application and share these screenshots,” said Dewan.

When the branch refused to identify his account and record, the customer identified that there could be two possibilities. “First, the application drop off data went to fraudsters who initiated a fake form and got us to pay. Shows that the system is compromised. Second, the Kotak Bank system is broken, and the application is sitting on some cloud,” he said.

Also Read: RBI bars Kotak Bank from adding new customers; Your money in the bank is safe

‘’In the nutshell, we have been conned by Kotak Mahindra Bank. Their system is either broken, or compromised, or both. The RBI crackdown on their online account opening is totally justified, we were unlucky that we trusted them a week prior to the order," said Dewan on X.

“As this series of tweets started picking up traction earlier today, the refund has been initiated from Kotak. Money is back, but trust is gone forever. Yet to receive a word from the bank on what went wrong,” he added on the thread.

While explaining the ordeal step-by-step, Dewan has attached all screenshots of the text messages and links received from the bank, which he later found were allegedly from a ‘fake website’ or a ‘fraud’. Before publishing this report, LiveMint reached out to Kotak Mahindra Bank for an official clarification or statement. The bank's response is still awaited.

In a restriction order on Wednesday, the RBI barred Kotak Mahindra Bank from onboarding new customers through its online portal and mobile app, and restricted it from issuing fresh credit cards, citing “serious deficiencies" in the bank's IT system.

The RBI said it found “serious deficiencies and non-compliances” in IT inventory management, patch and change management, user access management, vendor risk management, and data security for 2022 and 2023. 

The central bank also clarified that even as the restrictions are in place, Kotak Mahindra Bank will continue to provide services to its existing bank customers, including its credit card customers. “The bank has taken measures for adoption of new technologies to strengthen its IT systems and will continue to work with RBI to swiftly resolve balance issues at the earliest," a Kotak Mahindra Bank spokesperson said in a statement on Wednesday.

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First Published:25 Apr 2024, 05:12 PM IST
HomeIndustryBankingKotak Mahindra Bank scam alert! Amid RBI crackdown, customer ‘conned’ of ₹10k on account opening; money refunded

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