WESTERN UNION MONEY TRANSFER: CBN TO PENALISE BANKS FOR WRONG PAYMENTS

In response to the torrent of complaints and petitions against commercial banks that had wrongfully or by default paid money transferred to beneficiaries through the international fund transfer platform of the Western Union Money Transfer, the Central Bank of Nigeria has issued to commercial banks, additional information requirements and directive on Western Union Money Transfer operations in Nigeria.

The banking industry’s regulatory authority in a circular forwarded to commercial banks in the country acknowledged the absence of a fool-proof means of personal identification of beneficiaries of money transfer, to safeguard against the many incidences of payments of money transferred to identity thieves, the apex bank directed that bank should put in place additional safeguards that will ensure that payments are only made to the correct beneficiaries:

 

One of the additional requirements is that funds transferred shall only be collected in the designated town for payment and nowhere else. In addition, commercial banks are now required to investigate customers’ complaint within one week before referring the beneficiary to the sender for onward complaint to Western Union Money Transfer International.

 

The circular signed by the apex bank’s director of banking supervision, Mr. OI Imala, also requires that the copy of beneficiary’s photograph forwarded by Western Union Money Transfer to the banks should be personally produced by the beneficiary at the point of collection before payment is made.

 

The CBN warns that in cases where these safeguards are not strictly applied, banks will be held liable and shall be made to refund any amount paid to wrong beneficiaries.

 

A Central Bank source explained that the circular was meant to find a lasting solution to the continuous complain of banks customers that petition the CBN over the wrongful payment of money sent to them but wrongfully paid to some other people.

 

“Some of these customers actually alleged that the mistaken payments were made in connivance with some bank staff and identity thieves.” FORTUNE & CLASS source said. “The CBN had to insist in that circular that banks investigate claims of customers before referring the customers back to the senders from whom the fund emanated so as to ensure that the wrongful payments were not deliberately contrived within the bank.

 

“The basis of the proof of identity is the new requirement that the sender must provide a copy of the passport photograph of the beneficiary here in Nigeria to Western Union Money Transfer which will now forward the photograph to the paying bank. Now, before payment is made to anybody, the person laying claim to the transferred money must provide a copy of the photograph at the point of collection before payment is made.”

 

The CBN source added that with this requirement, it will be easy to identify who the true beneficiary of fund transferred is and if a bank refused to adhere to this guideline strictly it would show that it breached the process, so rather than make excuses and refer the customer-beneficiary to the sender, the CBN will deem the bank culpable and shall be made to make refund to the true beneficiary.