An international company is suing the Bank of Bermuda for $262,000 — the sum which it claims the bank, by failing to make basic checks, allowed fraudsters to withdraw from its account — plus damages.

Goran Management Ltd., a Bermuda-based insurance products company, states in its complaint that a bank employee gave details of the balance in Goran's accounts in response to an inquiry over the phone by the fraudsters.

According to court documents, the fraudsters then followed up with a faxed request, bearing false signatures to authorise withdrawal of the money. They successfully made six withdrawals, totalling $262,000, between October 16 and December 7, 2007.

The Bank of Bermuda has until December 31 to file its defence in the civil case.

The documents, which were filed in the Supreme Court on October 17 and were acquired by The Royal Gazette, say the fraudulent caller to whom the employee gave details of the account balances "had an Indian or Chinese accent of such strength, it was difficult to understand him".

The bank employee had no previous experience of the account and so was "not in a position to make any personal judgement based on experience".

The caller was impersonating Goran chairman Gerald Gordon Symons, a Canadian national, and a long-standing client of the bank. Other Goran officials named are director Michael Bott, of Bott & Associates, and Susannah Daugharty, executive assistant to Mr. Symons.

"Reasonable enquiry of the numerous persons in the Bank familiar with the account of the plaintiff and Mr. Symons would have revealed that he is a white North American and speaks with an accent that is extracted from that part of the world," the complaint continued.

Goran claimed the Bank of Bermuda had "failed to provide banking services to the plaintiff with reasonable care and skill" and had breached it fiduciary duties to protect the client against fraud.

Goran director Mr. Bott said yesterday: "We are not pleased at the way the bank has handled this matter. In particular, the fact that the bank appears to be relying on certain terms and conditions to exempt themselves from negligence, notwithstanding the substantial loss Goran has suffered.

"We would be interested to hear from other customers of the bank who have had a similar experience."

A spokeswoman for the Bank of Bermuda said the bank had no comment, as the matter is before the courts.

Goran lists a number of basic flaws in security and privacy that were shown up in the episode. The company said the fraudulent payments were made:

• Despite the fact that written instructions were not on the normal letterheads or from the normal addresses or fax numbers.

• The normal procedure of the preceding phone call from the company did not happen.

• "Normal security questions" were not asked.

• The sums involved were unusual for Goran's account.

• The recipients of the money were at a location to which the plaintiffs had never made payments before.

• The instructions to withdraw the money came from an account never used before by Goran.

Goran suggests that the facts would put any reasonable person in the Bank's position "on notice of fraud", yet the Bank made no further inquiries.

Goran is seeking payment from the Bank of the $262,000 taken by the fraudsters, as well as $240 in commission paid to the Bank for making the payments, plus interest and costs. It also wants damages for breach of contract, breach of duty at common law, breach of fiduciary duty and breach of statutory duty.