Brazilian Bank C6 Ordered to Repay and Compensate Elderly Man for Unauthorized Loan
A 72-year-old retired man in Itanhaém, São Paulo, has been awarded R$10,000 in moral damages and double the repayment of unauthorized loan deductions after discovering charges on his pension benefit. The man, who is digitally illiterate and receives benefits from the National Social Security Institute (INSS), found monthly deductions for a R$3,383.52 loan since January 2021. He claims he never contracted the loan, did not recognize the signature on the contract, and noted inconsistencies in his personal data, such as being listed as single when he has been married for over 40 years.
The court ruled against C6 Bank after the institution withdrew its request for a forensic examination of the contract, which the judge deemed essential for verifying its legitimacy. The judge stated that C6 Bank's withdrawal made it impossible to consider the contract valid. The bank was ordered to refund the deducted amounts in double and pay the R$10,000 in damages, which the judge considered a proportional amount to compensate the victim and punish the bank.
C6 Bank stated that it does not comment on ongoing legal processes and that the decision is subject to appeal. The bank highlighted its fully digital contracting process since 2021, which includes facial biometrics, proof of life, geolocation, and multi-step consent confirmation. They also mentioned adhering to industry self-regulation initiatives to combat fraud and harassment in loan offerings. This case follows a previous incident where the INSS temporarily suspended new C6 Bank loans due to alleged improper charges to beneficiaries.
This legal decision underscores the critical importance of robust consumer protection, particularly for vulnerable populations like the elderly. The court's finding that the bank abandoned its own defense by withdrawing from a crucial forensic examination highlights a potential systemic failure in due diligence, irrespective of the bank's stated digital security measures. The ruling also points to the broader challenge of digital illiteracy intersecting with financial services, creating avenues for potential exploitation. Moving forward, financial institutions may need to enhance proactive verification protocols beyond digital safeguards to ensure genuine consent and prevent unauthorized transactions, especially when dealing with products like pension-backed loans where beneficiaries are often highly dependent on their income.
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