EFCC compels Sterling Bank to admit cheating customer of N10.5m

Banking relationship did certainly went awry between Sterling Bank and Great Bakis Limited, its customer that had taken several loan and overdraft facilities from the bank. This banking relationship should, under normal circumstance, have ended on a happy note had the bank shown some conscientiousness in its figure adds up.

The figures did not add […] here

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EXPERT DECRIES BANK CHARGES ON RETURNED CHEQUES AS ILLEGAL

Mr. Ori Adeyemo, a forensic accountant and crusader for streamlined bank charges, has decried bank charges on returned cheques and described the fee deducted from accounts in consequence of returned cheques as illegal.

“It is trite that by virtue of Section 10, subsection of the defunct Central Bank of Nigeria (CBN) Bankers’ Tariff, a bank is allowed to charge N1,000 for a returned corporate cheque whilst debiting N300 for a returned individual cheque (to be borne by the drawer),” Adeyemo said.

“It is also true that by the provision of Section 11, subsection 6 of the subsisting CBN Guide To Bank Charges effective January 01, 2004, a returned cheque attracts 0.5 per cent of amount, maximum N5,000 (to be borne by the drawer).

“In both cases,” Adeyemo argued, “the CBN guidelines stipulate that only the drawer of a cheque should be penalised for a returned cheque and not the supposed beneficiary (who never took value for consideration anyway.)  Unfortunately, we all know that this situation is not true in Nigeria as banks whimsically charge both the drawer and drawee for a returned cheque, thereby amounting to double-jeopardy especially for the drawee who never took any benefit.”

 Affirming the contradiction in the statutes relating to fees sanctions as a result of returned chques, Adeyemo said: “I must emphasise that the CBN is wrong to have inserted returned cheque fee into the defunct Bankers’ Tariff as well as the subsisting CBN Guide To Bank Charges being in crass breach of the Dishonoured Cheque (Offences) Act of May 20, 1977, which makes it a nullity for the following reasons:

a.     That a returned cheque is a criminal offence and not a civil offence.

b.    That only the injured party (that is, the supposed beneficiary) has a right to complain about a returned cheque to the Nigeria Police or better still, the Economic & Financial Crimes Commission (EFCC) and definitely not a bank.

c.     Returned Cheque Fee is a penalty which only a court of competent jurisdiction can impose on a citizen of the country. 

d.    No party to a contract can impose any form of penalty/fine on other parties to a contract as doing so is repugnant to natural justice.  

e.     That a bank has no special or pecuniary interest in a returned cheque being just a clearing vehicle for a deposited cheque.

f.     That Section 9 of the subsisting CBN Guide to Bank Charges, clearing of cheque or draft in Nigeria is free.  Moreover, no bank can charge any fee for collecting any deposit in Nigeria.

g.    That according to the Dishonoured Cheque (Offences) Act of May 20, 1977, upon conviction; an individual is liable to two-year jail term without an option of fine while for a body corporate a penalty/fine of not less than N5,000.

h.     Only the Attorney-General of a state (without excluding the Attorney-General of the Federation) has a right of criminal prosecution of a defaulter and definitely not a bank.

i.      That Section 25 of the Interpretation Act (which provides that a person shall not be punished twice when guilty of an offence under more than one enactment) shall apply in respect of offences under this act.

j.      Since this Section 11.6 of the subsisting CBN Guide to Bank Charges as it relates to a bank charging its customer Returned Cheque Fee is in breach of the Dishonoured Cheques (Offences) Act being a legislation of the National Assembly, the Dishonoured Cheques (Offences) Act will prevail.

“In simple language, I am saying that since a bank is not a party to a returned cheque, then such bank cannot lay claim to it.  We should cast our mind to the law of privities of contract wherein it is clearly stated that only parties to a contract can sue for the enforcement of a contract and not even those in whose interest the contract was made,” Adeyemo insisted.

“You will agree with me that the initial beneficiary of a clearing cheque is the bank that went to clear the cheque that should have taken custody value for the drawee but that alone does not give room for the bank to lay any claim on the money since the bank is not the real beneficiary of the fund but just a mere custodian.

“Therefore, I cannot but submit that the present CBN Guide to Bank Charges, is fraught with illegalities to the crass detriment of bank customers thereby allowing banks to smile away at all times, leaving the customers short-changed.  In fact, this was one of the issues I had wanted to address in May 2008 at the House of Representatives’ probe of the banking industry until it was fraudulently compromised by the banking cabal working in concert with the then leadership of the House Committee on Banking & Currency.”

Adeyemo argued that on account of the subsisting convention of fee sanctioning for returned cheques, he had been demanding a review of the CBN Guide to Bank Charges: “I cannot but request for a thorough review of the CBN Guide to Bank Charges wherein the opinion of every stakeholder in the industry will be accommodated as against the present one which was drafted by Mr. Jim Ovia, the Zenith Bank Plc Managing Director and so wholesomely adopted by the CBN without any input from the bank customers, thereby skewing the graph in favour of the banking industry.

“In simple words, I submit that it is totally illegal for any Nigerian bank to penalize a customer for a returned cheque, as doing so will translate to the fact that the banks have become laws unto themselves, having illegitimately taken over the job of the judiciary,” Adeyemo submitted. 

Customer Protests e-Banking Fraud at GTBank

 When Mr. Friday Musa, made the extra effort to track sums of money allegedly illegally transferred from his account with GTBank to two accounts with the same bank, he thought he had resolved his banking woes that had made him about N1million poorer. The resolution of his tiff with the bank over the illegally transferred fund was no near resolution even as he presented argument that since there were evidence that the money fraudulently transferred from his account can be tracked to accounts within the bank should have made it easier for the bank to investigate the fraud and refund him his money accordingly.

Musa’s one million naira travail commenced this past Sunday, 6 July, 2008 when he noticed that his email password was not functional. According to Musa, he had rushed to the Opebi-Ikeja branch of the bank where he usually conducted his banking services, on Monday 7 July, 2008, to inform the appropriate official of his fears and suspicion over the non functionality of his email password.

“I was directed to an officer in the bank branch who took my complaint after which he gave me an update form for a new email password.” Musa said. “I had sincerely thought that the email password malfunction was just a mere glitch so I thought nothing of it after I had filled the update and was rest assured the password would have changed.”

“But three days there after, I was at the bank to make some withdrawals from my account only to be told I could not make withdrawal of the sum I required. I was told that four transactions involving withdrawals had been illegally conducted on my account via the internet banking platform of the bank, even as I was informed that the email password change that I had earlier requested had not been effected.”

The simple explanation of the banking troubles of Musa is that he had fallen victim of e-banking. e-banking is supposed to be a convenient banking platform that enables a bank customer to transfer funds at anytime of the day from his account to another accounts or other accounts.

Musa said he did not make such transaction and was even more bewildered when no SMS Alert of the transactions was sent to his mobile phone as it is the practice with GTBank.

Musa’s account was systematically raided between Friday 4 July, 2008 and Sunday 6 July 2008. Naturally, Musa took issue with the bank through a letter dated 10 July 2007. In the letter, he insisted that he did not conduct any form of e-banking transaction during this period and pleaded with the bank to HELP him out of the trouble.

GTBank, through a letter dated 14 July, 2008 gave a terse response to Musa’s pleas. Enyinna Mbagwu and Lanre Kasim, signatories to the letter informed Musa that after conducting an investigation occasioned by Musa’s letter, they were able to ascertain that the sum of N250,000 was debited to the account on 4 July, while on 7 July, three debits were made on the account: N249,000, N250,000, and another N250,000 totaling N999,000. They explained that online transactions done on weekends and other non-working days usually have a value date of the next working day. This addendum might have been highlighted in the letter to explain the fact that the notification of the need to change password made by Musa on the made he reported the malfunction of his email password to the Opebi branch of the bank was belated.

The authors of the bank’s letter to Musa further submitted that the internet transfers were made using his profile.

“To this end, we believe your details must have been compromised…In view of the above, we regret to inform you that the bank cannot accede to your request of a refund of N999,000…Please accept our sympathy on your loss.” The letter concluded just before sarcastically thanking Musa for his continuous patronage of the bank.

But then, Musa won’t be assuaged. “See, I suspected something suspicious was going on because I had always refused the e-banking platform just as I detested using even the ATM, I like to be conservative about my banking transactions because of my fears of fraudulent issue like this.” Musa opined

“Now knowing that I may not be able to make any headway with the bank this way, I demanded that they should track the transfers. At least, that should be simple enough, this is different from a cash withdrawal where the fraudulent person would have taken the money and walked out of the bank into thin air. In this case, the bank can easily track which account the money was transferred to and identify the owner(s) of the account. But GTbank refused to budge in this regard. To effect this, I asked my lawyer to write them resulting in the lawyer’s dispatch to the bank on 22 July, 2008 only for them to reply by a letter of 7 August, 2008 that merely asserted their earlier position on the matter.

“My worry now is that I am sure the money was transferred from my account to other accounts domiciled in GTBank and all I expect them to do is to investigate these accounts and come up with conclusion. If they are reluctant to do these they should simply refund my money so I can concentrate on my business. The distraction is affecting me negatively.” Musa said.

When Fortune and Class Weekly sought to check the allegation with the corporate affairs department of the bank, the front office officials insisted that was no need to see anybody at the corporate affairs department because the matter was a private issue between the bank and its customer, and it is our believe that Mr. Tayo Aderinokun, GTBank’s MD, will not be all pleased about this.