Safety is bank’s liability

Pushpa Girimaji

Whenever I read about thefts of bank lockers, I get worried. On my query, the bank in which I have a locker told me that in case of a robbery, banks are not expected to compensate the consumer for any loss of valuables inside the locker. The bank also told me that the terms and conditions governing the hiring of lockers make it clear that banks are not responsible for any loss of valuables in the locker. Is this correct?

Banks that provide safety deposit lockers (and charge a fee for it) are supposed to ensure that the lockers are safe in all respects. Failure to do so constitutes negligence and banks are liable for the consequences. In such cases, terms and conditions limiting the liability of the bank will not give the bank any protection. Nor will it prevent consumers from getting compensation.

In Punjab National Bank, Bombay, Vs K.V. Shetty (FA No 7 of 1991), the apex consumer court dismissed a similar argument put up by the bank and awarded the consumer, who found the contents of the locker missing, a compensation of Rs 1,26,017 along with interest calculated at the rate of 18 per cent.

Similarly, in Union Bank of India Vs Smt Kanak Choudhary (RP no 889 of 2000), the National Consumer Disputes Redressal Commission reiterated that the bank was bound to ensure that the locker remained safe in all respects and awarded compensation for the loss of currency notes and important papers eaten up by termites in the locker.

To all those who are worried about the safety of their lockers, I would suggest three steps: First, question your bank on the security arrangements in place for the safety of your lockers. If you are dissatisfied with the bank’s answer, complain to the Reserve Bank and get the bank to spruce up its security.

Second, make an inventory of all the goods that you have kept in the locker. If you have kept property papers and share certificates, get copies made. As for jewellery, make a list, take their pictures and get their valuation. Keep a record of your visits to the locker and make a note of what is taken out and put back.

Third, always ensure that you have complete privacy when you operate the locker. As you know, a locker can only be opened with your key as well as the key with the bank. Wait for the bank employee who opens the locker using the bank’s key to exit before you open the door. You must also ensure that other customers of the bank are not present while you open the locker. Remember, you are paying for the service provided by the bank.

What are the causes behind locker thefts?

Well, it’s a combination of factors. The negligent attitude of banks, lack of adequate security, failure to comply with the banking regulator’s directions and, in some cases, failure to check the track record of the employees before hiring them.

Two years ago, for example, a bank employee of Punjab National Bank was taken into custody by the Kozhikode (Kerala) crime branch, on charges of stealing valuables from the safe deposit vault of a customer. But in most cases, police investigations reveal that poor security systems are an open invitation to thieves. So, almost every year, there are reports of locker thefts. In 2015, four lockers of PNB’s Lalpur branch were emptied out by thieves in Ranchi. A year before that, the daring robbery at the Gohana branch of Punjab National Bank, Sonepat — wherein miscreants dug a 125-feet tunnel from an abandoned neighbouring house to the strong room and looted the contents of 89 lockers — showed total apathy of the bank towards lockers. Initial reports said that the flooring of the strong room was not as per required standards.

In January 2013, 38 lockers of Punjab and Sind bank (Reru Chowk branch) in Jalandhar were broken into! A year before that, robbers cleaned out six lockers of Punjab and Sindh bank in Yamunanagar (Haryana). In November 2010, 45 lockers in the Chirgaon branch of Central Bank of India (Jhansi district, Uttar Pradesh) were looted. The bank did not even have a security guard!

So consumers need to question banks on the security of the lockers and put pressure on them to act.