Banking: Liability for Repaying Bank Funds Embezzled by an Employee

Practical Laws of Islam as per the teachings of Imam Khamenei

Banking: Liability for Repaying Bank Funds Embezzled by an Employee

English:

Question #1921:

A person received a sum of money from a bank to fund a silent partnership. After a while, he repaid the money, by installments, to the bank alongside its share of the profit. However, the bank employee who received those installments embezzled the money by forging the documents as he confessed before the court. Should the person who procured the money for the silent partnership in the first place still be liable to pay it back to the bank?

Answer #1921:

If the phased repayment of the money to the bank was made according to the procedure in place, and the embezzlement of the money by the bank employee was not originated from the borrower acting irresponsibly, the latter should not stand to compensate the money. The employee who embezzled the money should make the compensation.

-Imam Khamenei, Practical Laws of Islam, Importance and Conditions of Banking