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By Ravi Ladduwahetty

The Government will shortly introduce new legislation which will combat credit card frauds and legalise transactions in relation to electronic banking and internet. These laws are also a part of the ongoing financial reforms program.

The attention of the Government has been drawn to the drawing up of an Electronic Transactions Act, Electronic Funds Transfer Code and the requisite amendment to the Criminal Law to cover credit card frauds, Consultant the Financial Sector Reforms Program Dr. Wickrema Weerasooria told the Daily News in an interview yesterday.

Dr. Weerasooria who chaired a meeting with the five premier credit card issuing banks in this regard, said that the proposed legislation for Electronic Transactions, which will be based on the Australian Act of 1999 would also legalise digital signatures and optical archiving. This will also mean that the Internet transactions and e-mail transactions which are sent at the click of a mouse will also be legal.

The five banks are: the Bank of Ceylon, Commercial Bank, Hatton National Bank, Standard Chartered Grindlays, Hong Kong Bank (HSBC) and Sampath Bank.

HSBC's Manager of the Card Centre Priyan Attygalle told the Daily News that the current laws governing e- commerce were very primitive and that the new legislation would mean that old records which have been maintained in diskettes would also be deemed valid.

Dr. Weerasooria said:" The new Electronic Transactions Act will apply to all banking and all electronic transactions which mean that electronic mails will also be accepted as legal in contrast to the present system where the written signatures are deemed mandatory.

The legislation for Electronics Fund Transfer Code will be drawn on the Australian model for the Electronics Fund Transfer Code of 2001. He said that all Sri Lankan banks will be at various stages of their technological development and to issue a single document would not be possible right now. He proposed that this could be a guideline and develop it to suit the technical capability of the individual bank. Dr. Weerasooria said that if it was approved, around 80 percent of the Australian model could be used as a common role model for all banks and 20 percent could be in order to suit the individual requirements of the individual bank.

It will define the degree of liability when a Credit Card or a Automated Teller Machine (ATM) card is lost. It will also define the context of the liability in terms of stolen cards and the point of the card's lability between the holder and the issuer, Attygalle said.

It also has details pertaining to telebanking, he said.

Commercial Bank's Additional General Manager (Operations) Sanath Bandaranaike said that it was very important that the new laws were implemented soon as there was a need to combat the ever growing need for combating frauds in credit cards.

He said that the present Penal Code was empowered to nab defaulters of forged currency notes but the racketeers of credit cards were getting away with impunity due to the absence of the requisite laws.

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Copyright 2001 The Associated Newspapers of Ceylon Ltd.
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