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Diamond Trust Bank (DTB), one of East Africa’s biggest lenders with operations in Uganda, Kenya, Tanzania and Burundi, has once again found itself at the centre of controversy after a Kenyan High Court ordered the bank to compensate a customer who lost hundreds of millions of shillings in a SIM swap fraud.The High Court in Machakos ruled that DTB Kenya should shoulder 40% liability, equivalent to about UGX 178 million, after fraudsters stole approximately UGX 441 million (KES 4.42 million) from customer Mercy Wairimu Kariuki’s account.Telecommunications giant Safaricom was found 60% liable and ordered to pay roughly UGX 263 million.The fraud dates back to February 2022 when criminals illegally swapped Mercy’s SIM card before accessing her mobile banking account. Within three days, about UGX 441 million was transferred from her account through DTB’s mobile banking platform and Pesalink into several bank and mobile money accounts.Although the fraudsters used the correct PIN, the High Court ruled that this alone could not excuse the bank from responsibility.Justice Asenath Ongeri said banks are expected to detect suspicious activity and cannot simply rely on a customer’s PIN when transactions are clearly unusual.The judge also dismissed DTB’s defence that some transactions occurred over a weekend when staff were unavailable, noting that modern banking systems operate 24 hours a day, seven days a week, and banks remain responsible for monitoring suspicious transactions at all times.The latest judgment has once again drawn attention to DTB’s long history of fraud allegations, regulatory sanctions and court battles across East Africa—including Uganda.In Kenya, former DTB branch managers and senior officials are currently battling 68 criminal charges linked to the alleged theft of about UGX 4.35 billion from a customer’s foreign currency account through forged documents, fake emails and fraudulent withdrawal instructions.Investigators claim the scheme operated for nearly five years before it was uncovered.The bank has also previously been linked to several other fraud scandals, including allegations involving unauthorized withdrawals from customers’ fixed deposit accounts and regulatory penalties imposed by the Central Bank of Kenya.In Uganda, DTB became headline news following the high-profile legal battle with city businessman Hamis Kiggundu, who accused the bank of unlawfully debiting more than UGX 120 billion from his companies’ accounts. The dispute generated one of the biggest banking court cases in Uganda’s recent history.The latest ruling is likely to fuel fresh debate among customers in both Kenya and Uganda, where DTB operates an extensive branch network, over the security of digital banking platforms and the responsibility of financial institutions to protect customers against increasingly sophisticated cyber fraud.While DTB Kenya sought to overturn the earlier decision, the High Court dismissed its appeal, meaning the bank and Safaricom must now compensate the customer for the losses arising from the SIM swap attack.GOT A HOT STORY? LET US KNOW!Got breaking news, explosive secrets, or hard evidence?Email us: redpeppertips@gmail.comWe accept tips, documents, videos, photos, and recordings—the more evidence you have, the better.CONFIDENTIALITY IS OUR TOP PRIORITY. SOURCES ARE ALWAYS PROTECTED!About Post Author
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