Bank’s Liability in Electronic Fund Transfers and its Legal Effects

Abstract

The bank, as a legal person, can typically be held legally liable under civil, penal, and administrative law for actions it performs. Liability, in general, arises from contractual obligations or tort. The electronic fund transfer process (EFT) is an example of the bank's contractual obligation. The applicable law and its specificity determine electronic contracts' legality and probative value. This research aims to clarify the position of the Jordanian legislator regarding the EFT payment process and the legal consequences and risks related to this process. It also aims to determine banks' liability for executing EFT operations in case of tort or negligence. The researchers employed the analytical and deductive approach. The results indicated that the Jordanian legislation in Electronic Transactions Law No. (15) of 2015, the system of payment and electronic transfer of funds 2017, and the Banking Law No. (7) of 2019 have granted electronic bonds the same probative value as the traditional bond. However, numerous legislative texts still require revision or replacement to accommodate the demands of commercial and economic transactions. For example, specific regulations for banking e-payment and funding operations and transfers should be included.