Resolution No. JB-2015-3499 of the Banking Board

Banking Board of Ecuador

RESOLUTION No. JB-2015-3499 THE BANKING BOARD

CONSIDERING:

THAT by Resolution No. JB-2015-3352 of April 15, 2015, the Banking Board resolved: "REJECT the claim contained in the review appeal filed by Mr. Antonio Acosta Espinosa, Vice President of Banco Pichincha C.A.; and, consequently CONFIRM the administrative act contained in letter No. IRG-DAyEU-V-R-2014-296, of April 9, 2014, which ratifies letter No. IRG-DAyEU-V-R-2013-572, of November 25, 2013, through which the Regional Intendancy of Guayaquil ordered restitution in favor of Mr. Christian Eduardo Matamoros Jouvín for the sum of USD $180.00," fundamentally for the following considerations:

"(...)

THAT this challenge is resolved in accordance with the First Transitional Provision of the Organic Monetary and Financial Code, published in the Official Register Second Supplement No. 332, of September 12, 2014, whose text states that resolutions recorded in the Codification of Resolutions of the Superintendency of Banks and Insurance and the Banking Board, and norms issued by control bodies, will remain in effect insofar as they do not oppose what is provided in the Organic Monetary and Financial Code, until the Monetary and Financial Policy and Regulation Board resolves what corresponds, according to the case; and with the second paragraph of the Third Transitional Provision, which states that the Banking Board will continue to act until it resolves all complaints, appeals, and other administrative procedures it was handling as of the date of entry into force of the same, within a period of one hundred eighty days, extendable at the discretion of the Monetary and Financial Policy and Regulation Board, which grants this control body competence to hear and resolve the present review appeal;

THAT through communication entered into the Regional Intendancy of Guayaquil, of this Superintendency of Banks on August 28, 2012, Mr. Christian Eduardo Matamoros Jouvín brought to the knowledge of this control body that in June 2012, a charge was registered on his Mastercard credit card No. 89230002018807, for the value of USD 180.00, which was never made by the user;

THAT through letter No. IDG-DAYEU-ISFP-REQ-2012-0751, of September 6, 2012, on that date, the Acting Regional Intendant of Guayaquil, admitted the complaint mentioned in the preceding paragraph for processing, and requested the referred financial institution to provide substantiated and documented information with respective physical backups regarding the presented complaint, and informed the complainant about the matter;

THAT through letter No. BP-ACEC-2012-1126, of December 10, 2012, entered into this control body on the 11th of the same month and year, Mr. Jorge Andrade Merino, Regional Manager of Banco Pichincha C.A., provided a response to the control body's letter, and attached several documents related to the complaint;

THAT through letter No. IRG-DAyEU-V-R-2013-572, of November 25, 2013, the Regional Intendant of Guayaquil resolved the complaint in question, in the following terms:

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"(...) From the explanations and defenses sent by Banco Pichincha C.A., it has been evidenced that the complainant was not attended to promptly by the banking entity, observing the non-compliance with the regulations...

b) From the documentation sent by the bank and by the user, it is appreciated that the consumption subject of the complaint was made on May 21, 2012...

(...)

e) In the affiliation contracts that banking institutions sign with commercial establishments, the procedure to be followed when cardholders present complaints for unauthorized charges is explained, highlighting the following stipulations from them:

"(...) The Establishment undertakes that in the transactions it carries out, it will require the presence of the Cardholder, an identification document of the latter, and the presentation of the plastic of the Card.

Although the authorization guarantees that the Cardholder has sufficient credit to carry out the Transaction, it does not guarantee the identity of the person who signs the Voucher, with the verification of this being under the exclusive responsibility of the Establishment.

The Establishment is responsible for keeping the Vouchers that, being issued through electronic captures or POS machines, do not require deposit in the Acquiring Bank, for at least twelve (12) months following the date of their issuance for purposes of eventual complaints presented by the Cardholders. (...)"

For the aforementioned reasons, it has not been evidenced by Banco Pichincha C.A. that MEGAHOTELES CÍA. LTDA. complied with keeping the charge slip for the time stipulated in the signed affiliation contract, which should not have been less than twelve months, by not having sent it or demonstrated that it effectively requested the voucher from the referred establishment.

In merit of the above..., this Office resolves:

1. ACCEPT the complaint presented by Mr. CHRISTIAN EDUARDO MATAMOROS JOUVÍN, with citizenship ID No. 092240099-9, against the controlled financial institution BANCO PICHINCHA C.A. for the reasons indicated in the seventh section of this letter.

2. ORDER the controlled financial institution BANCO PICHINCHA C.A. to proceed to restore to Mr. CHRISTIAN EDUARDO MATAMOROS JOUVÍN, the sum of US$ 180.00 (ONE HUNDRED EIGHTY WITH 00/100 DOLLARS OF THE UNITED STATES OF AMERICA), and send to this Office, within a term of eight days, counted from the receipt of this letter, the documentation that accredits the compliance with this resolution

(...)." (sic);

THAT through communication of December 9, 2013, entered into the Regional Intendancy of Guayaquil, on the same day, month, and year, the lawyer Maria

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Elena Franco San Lucas, Judicial Attorney of Banco Pichincha C.A., filed an appeal for reconsideration against the administrative act contained in letter No. IRG-DAyEU-V-R-2013-572, of November 25, 2013, which was rejected through letter No. IRG-DAyEU-V-R-2014-296, of April 9, 2014, in which the Regional Intendant of Guayaquil ratified the appealed administrative act;

THAT through a document received in the Superintendency of Banks on April 23, 2014, Mr. Antonio Acosta Espinosa, Vice President of Banco Pichincha C.A., with the professional sponsorship of Dr. Pablo Cadena Merlo, and of lawyer María José Araujo Álvarez, filed a review appeal against letter No. IRG-DAyEU-V-R-2014-296, of April 9, 2014.

THAT the arguments raised by the appellant are limited to the following:

• That the complaint presented by Mr. Christian Matamoros was untimely, since the claimed consumption was made on May 21, 2012, and the complaint presented to the financial institution was made on August 25 of the same year, so it is surprising that the complaint is presented two months after the consumption was made;

• That Mr. Christian Matamoros asserts that he did not make the claimed consumption, to which this assertion is contradictory, since for the telephone acceptance, the client had to indicate to the company the card number, security code, and expiration date, since the client is the sole custodian of his credit card as well as the data contained therein;

• That the bank is not responsible for charges made while the credit card is active and under the custody of the client; even the control body must take into account that the client has not requested the blocking or cancellation of his credit card to date;

• That the conditions referred to in Article 5, of Chapter IV, regarding the procedure for handling complaints against institutions of the financial system, of the codification of resolutions of the Superintendency of Banks and the Banking Board, have not been met, so that the control body can order the return of the claimed values, since the financial institution has demonstrated with reliable proofs and facts that it has no responsibility, so the administrative act must be annulled.

THAT Article 52 of the Constitution of the Republic; Article 1, and letters b) and o) of Article 180 of the General Law of Institutions of the Financial System, in force at the date of imposition of the complaint, provide that the State guarantees to citizens the right to dispose of goods and services of optimal quality and that the Superintendency of Banks, as the competent authority, has the function and attribution to ensure the stability, solidity, and correct functioning of institutions subject to its control; to supervise that they comply with the norms that govern them;

THAT regarding the argument of the appellant in the sense that the complaint presented by Mr. Christian Eduardo Matamoros Jouvin was untimely, it is necessary to mention what is established in Article 4, of Book I, Title XIV, Chapter III, of the Codification of Resolutions of the Superintendency of Banks and the Banking Board, which establishes:

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"ARTICLE 4.- The rights of the user of the financial system contained in this code are irrenounceable as financial services are considered matters of public order, social interest, and observance throughout the country. Any stipulation to the contrary shall be considered null.";

THAT from the norm previously transcribed, it is inferred that the rights of the financial user are irrenounceable, so the argument of the financial institution which exposes the untimeliness has no legal basis, since the services offered by financial institutions, being of public order, the State and this control body must ensure and allow the implementation, development, and compliance of mechanisms that guarantee to the community access to services of optimal quality, and that financial users, when a right is violated, can file complaints or claims to demand the restitution of these violated rights;

THAT paragraphs 15.1, 15.2, 15.8, and 15.9, of Article 15, of Title I, Book I, Chapter V, of the Codification of Resolutions of the Superintendency of Banks and Insurance and the Banking Board, which provides:

"ARTICLE 15.- Institutions authorized to issue or administer credit cards, payment cards, affinity cards, closed-system affinity cards, and closed systems, must sign written contracts with affiliated establishments, in which at least the following clauses shall be stipulated:

15.1 Obligation of the affiliated establishment to receive the card as a means of payment;

15.2 Obligation of the establishment to issue the charge slip and to verify that the signature and rubric signed by the cardholder is the same as that recorded on the back of the card and in the identification document, for which the establishment will require the presentation of the identification document and will record on the receipt the number of the citizenship ID, identity, or passport;

(...)

15.8 Procedure and deadline for the presentation of charge slips by affiliated establishments;

15.9 Procedure for the cancellation of charge slips by the issuing or administering company of the card;

(...).";

THAT from the legal norm transcribed in the previous paragraph, it follows that, based on what is provided in paragraph 15.2, of Article 15, the banking entity is obligated to sign contracts with affiliated establishments, in which the obligation of the establishment to verify the identity of the credit card holder, and request the presence of an identification document, must be recorded;

THAT from the review of the file subject of study, it follows that Mr. Christian Eduardo Matamoros Jouvín allegedly authorized a debit via telephone in favor of the company Megahoteles Cía. Ltda., to which this National Intendancy has determined that the financial institution did not follow a correct procedure for the collection of the claimed debit, since within the documentation present, the recording of the call made by the

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user of the financial system, who would have allegedly accepted the charge in favor of the company, is not evidenced. Regarding this, what is stated by the bank does not exempt it from the responsibility of having required the receipt of the respective authorization for said charge, since it is important to mention that the telephone channel prevents the user from properly choosing a service before formalizing or perfecting the provision of the same through a contract. Additionally, it is not evidenced that the bank sent the agency contract between the financial entity and Megahoteles Cía. Ltda., with which the procedures for the cancellation of charges in favor of the company could be observed. To reinforce what is stated, it is important to mention what is provided in paragraph 11.1, of Article 11, of Chapter II, Title XIV, Book I, of the Codification of Resolutions of the Superintendency of Banks and Insurance and the Banking Board, which provides:

"ARTICLE 11.- The user shall have the right to access financial products and services, under the following conditions:

11.1 Sign contracts and accept financial services, through electronic or physical means or channels.

Both users and controlled institutions are obligated to keep a record of the signing of said contracts and acceptance of the offered services. Financial system institutions shall keep said contracts for a period of no less than six (6) years, as provided in the third paragraph of Article 80 of the General Law of Institutions of the Financial System.

In the case of financial services offered via telephone, these shall be accepted by clients through the respective contract or acceptance through electronic means or channels;

(...).";

THAT for the aforementioned reasons, it has been evidenced that Banco Pichincha C.A. is subject to Article 5 of Chapter IV, Title XX, Book I of the Codification of Resolutions of the Superintendency of Banks and Insurance and the Banking Board, since the situation that motivated the complaint was originated in an incorrect procedure of the controlled institution, and that the Superintendency of Banks, being in charge of supervising and controlling the operations of financial institutions at the national level, must protect the interests of the users of this system, therefore action must be taken as ordered for these effects;"

THAT through communication of May 13, 2015, received by the Superintendency of Banks on the 15th of the same month and year, Dr. Jaime Flor Rubianes, Legal Representative of Banco Pichincha C.A., with the professional sponsorship of Dr. Pablo Cadena Merlo and of lawyer Andrea E. García D., filed an appeal for reconsideration against the administrative act contained in Resolution No. JB-2015-3352 of April 15, 2015;

THAT the Banking Board, in the session held on June 24, 2015, in accordance with the second paragraph of Article 3, Chapter II, Title XVI, Book I of the Codification of Resolutions of the Superintendency of Banks and Insurance and the Banking Board, heard the appeal referred to in the preceding paragraph and determined that it does not comply with what is provided in the first paragraph ibidem, that is, that there are no new elements of fact or law that motivate the

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drafting of corresponding reports, so it decided to deny it outright; and,

IN exercise of its legal attributions,

RESOLVES:

SINGLE ARTICLE.- REJECT the appeal for reconsideration filed by Dr. Jaime Flor Rubianes, Legal Representative of Banco Pichincha C.A., against the administrative act contained in Resolution No. JB-2015-3352 of April 15, 2015; and, consequently, CONFIRM said resolution.

NOTIFY.- Given in the Superintendency of Banks, in Quito, Metropolitan District, on the twenty-fourth of June of two thousand fifteen.

[Signature] Econ. Rodrigo Landeta Parra GENERAL INTENDANT, S PRESIDENT OF THE BANKING BOARD, E

I CERTIFY.- Quito, Metropolitan District, on the twenty-fourth of June of two thousand fifteen.

[Signature] Lcdo. Pablo Cobo Luna SECRETARY OF THE BANKING BOARD