Supreme Court says banks should compensate digital fraud victims when due diligence fails

The Supreme Court said on Thursday that banks and other financial institutions should compensate victims of digital fraud when a failure of due diligence on their part enabled the fraud (Hindustan Times, Odisha Bytes, The Economic Times). A bench of Chief Justice Surya Kant and Justices Joymalya Bagchi and V Mohana made the remarks while hearing a suo motu case on digital arrest scams (LiveLaw, Scroll.in, The Economic Times).

What every report agrees on

Reports agree that the bench said compensation should cover at least the amount victims lost where bank lapses contributed to the fraud (The Economic Times, Odisha Bytes). They report that the court will examine the Reserve Bank of India's proposed Know Your Customer (KYC) Amendment Directions, 2026 (The Economic Times, Outlook), with DNA India saying the RBI was asked to frame refund rules under the new norms by December 31 (DNA India). Several outlets report that the Chief Justice questioned why unusual or suspicious transactions could not be stopped in time (The Times of India, Republic World), and that the court called for preventive checks on unusual transactions (Outlook). Many also report the bench's frustration that people, including educated people, keep falling for these scams despite awareness campaigns, media coverage and court orders (Hindustan Times, Highland Post, WION, Mint).

How the left-leaning press told it

Hindustan Times, Outlook, The Indian Express and Scroll.in: Bank liability and scam persistence

Hindustan Times and Outlook, rated centre-left, led with the rule that banks must compensate victims where due diligence fails (Hindustan Times, Outlook). The Indian Express, also rated centre-left, described a proposed direction making banks pay and face prosecution, and quoted the court calling digital arrest the biggest financial fraud on the economy (The Indian Express). Scroll.in led with the Chief Justice asking why Indians continue to fall for such scams (Scroll.in).

How the right-leaning press told it

The Times of India, The Economic Times, ABP Live and Republic World: Bank liability and RBI rules

The Times of India, rated centre-right, said banks must compensate victims and act as a protective umbrella for vulnerable customers (The Times of India). The Economic Times and ABP Live, both rated centre-right, focused on the RBI's proposed KYC directions, with ABP Live reporting Rs 800 crore in losses and an order for the RBI to list institutions covered (The Economic Times, ABP Live). Republic World, rated right, led with the bench asking what is wrong with victims, alongside its push for bank compensation (Republic World).

How the centre told it

Mint and WION: RBI rebuke and victim frustration

Mint, rated centre, said the court pulled up the RBI and sought strict liability, saying banks must compensate when their employees are found involved (Mint). WION, rated centre, led with the Chief Justice's blunt remarks on victims and described bank liability as a proposal (WION).

The coverage of this story does not divide along left and right lines.

What the record shows

The firmness of the step is told differently. LiveLaw, Odisha Bytes, Hindustan Times and Outlook report that banks must compensate (LiveLaw, Odisha Bytes, Hindustan Times, Outlook), while The Indian Express says the court proposed to issue such a direction (The Indian Express), National Herald says it is considering directions (National Herald), and DNA India says banks may have to pay (DNA India). CNBC-TV18 reports the court is weighing strict liability rules that could require full reimbursement if lenders fail to flag unusual transfers (CNBC-TV18). The Indian Express and National Herald add that banks could face prosecution for lapses (The Indian Express, National Herald). DNA India and ABP Live cite Rs 800 crore in losses (DNA India, ABP Live). Mint frames liability around involvement of bank employees (Mint).

Drafted by the Alethman engine from 17 independent reports, and checked by an editor before publication. An outlet's side comes from published media-bias ratings (Media Bias/Fact Check, AllSides) or documented ownership, named under the coverage bar; Alethman does not rate outlets itself.