SHAH ALAM: The High Court here has allowed an appeal by crypto e-wallet provider Luno Malaysia to overturn a RM700,000 award granted to a businessman in a negligence lawsuit last year.
High Court Judicial Commissioner Hazizah Kassim said in her decision that there were no security flaws committed by the company following allegations that a user's account was hacked.
The court also said that the Sessions Court, where the lawsuit was filed, had set an excessively high standard of security care and that there was insufficient evidence in the case.
On Aug 28, 2021, Yew filed a lawsuit against Luno for failing to safeguard the cryptocurrency in his Luno account.
He said money in the account was transferred out in three tranches by an unidentified hacker on March 6, 2021.
According to Yew's claims, RM566,570.70 in his Luno account was used in three transactions to buy 2.730096 Bitcoins (BTCs), describing these as illegal transactions that were carried out in a short span of time.
Yew claimed that Luno was negligent and that the company had a duty to take care of the funds based on its business expertise.
On Oct 30, last year, the Petaling Jaya's Sessions Court ordered the company to compensate Yew of RM598,000, the amount withdrawn by an unknown hacker from his account and RM100,000 in exemplary damages.
In a statement on Monday (July 29), Luno said that as a regulated digital asset exchange platform registered with the Securities Commission (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) with each transaction being authorised via an SMS authorisation link sent to the plaintiff's (Yew's) 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.
