Wambugu v Equity Bank Kenya Ltd (Commercial Suit 4025 of 2018) [2026] KEMC 329 (KLR)
The bottom line
#A Kenyan court dismissed a customer's claim against Co-operative Bank over fraud losses because he could not prove the transactions were unauthorized.
What this practically means
#Executive summary
#Key legal issues
#Whether the faulted transactions were fraudulent and authorized by PW1
The plaintiff failed to prove that the transactions were unauthorized; the court inferred they were authorized or done through his credentials
The plaintiff admitted his email was hacked and that payment instructions came from his hacked email and active Kenyan number. The defendant had OTP and password security measures in place. Without notification of his travels or a report of hacking to the service provider, the court could not conclude the transactions were unauthorized.
Whether the Defendant breached its duty of care
No breach found; the bank had reasonable security measures and its refusal to honour the Standing Order was a legitimate anti-fraud measure
The bank required passwords and OTP confirmation before effecting transactions. After the plaintiff reported fraud, declining to honour the standing order of Kshs 20,000/= was a reasonable protective step, not negligence.
Whether the Defendant is liable for the loss sustained
The defendant was not found liable
Having found the plaintiff did not adduce sufficient evidence that he did not authorize the impugned transactions, and on the strength of the defendant's argument that the plaintiff's own omissions were the proximate cause, liability could not attach.
Legal principles established
#- He who alleges must prove; the burden of proving that the bank was to blame for the fraudulent transactions lay on the plaintiff
- Where instructions originate from the customer's own email and phone number to which OTPs were sent, the bank is not complicit in the transactions
- Costs follow the event but that is not an invariable rule; the ultimate factor is judicial discretion
Court orders
#- 1.The plaintiff's suit is dismissed with no order as to costs
- 2.Each party to bear its own costs
- Jurisdiction invoked
- Original civil jurisdiction of the magistrate's court over the plaintiff's claim founded in contract and banking negligence
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Wambugu v Equity Bank Kenya Ltd (Commercial Suit 4025 of 2018) [2026] KEMC 329 (KLR)", Case Analysis (2026). Not stated in the judgment. Source: https://new.kenyalaw.org/akn/ke/judgment/kemc/2026/329/eng@2026-07-22
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.