SHAH ALAM: A crypto e-wallet provider Luno Malaysia has won its appeal to overturn the RM700,000 award granted to a businessman in a negligence suit last year.
High Court judicial commissioner Datuk Hazizah Kassim, when allowing the company appeals, ruled there were no security flaws committed by the company following allegations that a user's account was hacked.
The court also ruled that the lower court had set an excessively high standard of security care and that insufficient evidence was presented.
On Oct 30, last year, Petaling Jaya's Sessions Court ordered the company to compensate Yew See Tak of RM598,000, the amount withdrawn by an unknown hacker from his account.
The court also awarded RM100,000 in exemplary damages.
On Aug 28, 2021, Yew filed a lawsuit against Luno for failing to safeguard the cryptocurrency in his Luno account.
This was after money kept in the account was transferred out in three tranches by an unidentified hacker on March 6 the same year.
Yew claimed the company had a duty to take care of the funds based on its business expertise.
Meanwhile, Luno in a statement today said as a regulated digital asset exchange platform registered with the SC, the company has always upheld the levels of regulatory compliance and customer security.
"Luno security features operated as they were designed to, with all account security features being successfully passed (including two-factor authentication).
"Each transaction being authorised via an SMS authorisation link sent to the plaintiff's (Yew) mobile phone.
"The case also emphasises the need for customers to maintain the security of their own email accounts, mobile services, and passwords," it said.
The company said it will continue to focus on educating customers against financial fraud.