Bank duty of vigilance and a fraudulent transfer

A bank's duty of vigilance does not require it to block a transfer duly ordered by its client: it applies only where there is an apparent anomaly, one readily detectable by a diligent professional. The international nature of transfers, their number, their sometimes substantial amounts and their execution over a short period do not, in themselves, amount to such an anomaly.

The essentials

• The bank is liable for a breach of its duty of vigilance only if the transaction presents an apparent anomaly readily detectable by a diligent professional.
• The duty of non-interference prohibits the banker from investigating the origin, the reason for or the appropriateness of movements on its client's account.
• Numerous international transfers, of sometimes substantial amounts and executed over a short period, do not in themselves amount to an apparent anomaly.
• A client who has personally ordered the transfers, on a sufficiently funded account, bears the risk of the fraud so long as no detectable anomaly is established.
• The optional mention of the name of a beneficiary bearing the same surname as the client may reinforce the bank's understanding that the transaction is a family matter.

Eight transfers abroad and an alleged fraud

A bank which executes authorised transfers does not breach its duty of vigilance where the transactions reveal no apparent anomaly. The commercial chamber dismisses the appeal to the Cour de cassation brought against the court of appeal's decision (Com., 25 March 2026, No. 24-18.093) and holds that the disputed transfers did not present apparent anomalies readily detectable by a diligent professional.

The client, who held accounts and investments with the bank, ordered eight transfers between 26 February and 25 April 2020, to accounts held with banks located in Belgium. They then argued that they had been deceived by a person who led them to believe that sums had to be paid in order to unwind a life insurance policy taken out by their husband. They brought a liability claim against the bank, alleging a breach of its duty of vigilance when executing those instructions.

The decision under appeal (CA Rouen, 23 May 2024, No. 23/01105) dismissed those claims. The lower court judges first noted that the transfers were authorised within the meaning of Article L. 133-6 of the French Monetary and Financial Code. They recalled that "a banker is bound by a duty of non-interference requiring it not to carry out investigations into the origin, the reason for or the appropriateness of movements on its client's account" (free translation). They found that the bank had satisfied itself that the account was sufficiently funded.

In the light of those statements, findings and assessments, the court of appeal, leaving aside the superfluous reasoning criticised by the second limb, was entitled to hold that the transactions did not present apparent anomalies readily detectable by a diligent professional, and correctly inferred from this that the bank had not breached its duty of vigilance.

The second limb of the ground of appeal, which criticised the attempt to recover the funds in the light of Article L. 133-21 of the French Monetary and Financial Code, is declared ineffective: it targeted superfluous reasoning in the court of appeal's decision.

What the bank must check before executing a transfer

The bank checks the apparent regularity of the instruction, not the economic appropriateness of the transaction. It verifies that the instruction does come from the client and that the account is sufficiently funded. It does not have to ask the client why they are paying, to whom, or whether the payment is of any use to them. This restraint is not a favour granted to banks: it also protects the confidentiality of the client's affairs and the speed of payments.

The duty of vigilance is the exception to that principle. It requires the banker to react to an apparent anomaly, that is, an irregularity which a diligent professional spots without any particular investigation. The anomaly may be formal, such as a manifestly forged signature, or intellectual, where the transaction is manifestly out of keeping with the operation of the account. The decision under review sets the threshold: the mere combination of an international character, sometimes substantial amounts, a number of transfers and execution within a short interval is not enough.

For the victim of a false payment instruction fraud, the consequence is direct. Where they themselves gave the instructions, they cannot shift the burden of the loss onto their bank by relying solely on the beneficiary's profile or the foreign destination of the funds. They must establish something the professional could detect from the face of the transaction, without investigating its cause.

A confirmation of the apparent anomaly standard

The solution applies the apparent anomaly standard and refuses to extend it to transfers that are merely unusual. The appeal invited the commercial chamber to hold that a transfer which is unusual in the client's practice is enough to trigger the duty of vigilance. That reading is rejected: an unusual character is not the same as an apparent anomaly. The court of appeal was moreover entitled to take into account the optional mention of the name of a beneficiary bearing the same surname as the client.

One reservation remains. The commercial chamber reviews the legal characterisation, but the assessment of the circumstances is a matter for the lower court judges: the wording that the court of appeal was entitled to hold that there was no anomaly signals a decision turning on its own facts. A different set of facts — a radical break in the operation of the account, alerts raised by the client, manifestly suspicious instructions — may lead to a different outcome. Nor does the decision rule on grounds of liability other than the duty of vigilance.

Transfer fraud: the evidential reflexes

Litigation is won by showing an anomaly detectable at the time of execution, not by recounting the fraud. The debate concerns what the bank could see of the transaction, not what the client did not know. The chronology of the instructions, the account history and any exchanges with the adviser are therefore at the heart of the case.

• Keep the full account history over a significant period, so as to objectify the gap between the disputed instructions and the previous operation of the account.
• Document any report made to the bank before or during the execution of the instructions, together with its response.
• Check whether the instruction contained any wording capable of alerting the professional or, on the contrary, of reassuring it.
• For companies, formalise an internal procedure for the dual validation of transfers and for checking changes to a supplier's bank details.

What checks after a disputed transfer

The decision invites a distinction between two questions that are often conflated. The first concerns the instruction: did the client give it, or was the account misappropriated? The second concerns the anomaly: was the transaction, as it appeared to the bank, manifestly irregular for a diligent professional? Where the transfers were authorised by the client and the account was funded, the mere oddity of the beneficiary or of the destination is not enough. The case is therefore built on objective evidence, gathered quickly, rather than on the seriousness of the damage suffered alone.