Fraud

One Month After Launch: MTN’s MoMo PSB In Alleged N23bn Fraud

Published

4 years ago

June 27, 2022

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Momo Payment Service Bank Limited (MPSBL), the banking subsidiary of MTN Nigeria Communications Plc, is currently enmeshed in an alleged N23 billion fraud scandal, one month after the launch of the platform.

The mobile money banking firm has urged the Federal High Court to compel 18 commercial banks to refund the said fund which was transferred to their customers,

The money, MPSBL said, was erroneously and fraudulently transferred in 700,000 transactions into about 8,000 accounts belonging to the customers

The subsidiary also urged the court to order the banks to provide information about the customers into whose accounts the funds were mistakenly paid.

The requests form part of the reliefs in a suit filed by MPSBL through its lawyer, Lotana Okoli (SAN).

MPSBL averred that under the Central Bank of Nigeria (CBN) Regulation on Instant (Inter-Bank) Electronic Funds Transfer Services, made pursuant to sections 2(D), 33(1)6) and 47(2) of the CBN Act 2007,it is incumbent on the banks to make refunds and provide the required information.

MPSBL’s Chief Executive Officer (CEO) Anthony Usoro Anthony said in a supporting affidavit that his bank suffered “a system exploitation” on May 24, 2022, during which 700,000 transactions were processed with credits being made into about 8,000 accounts in the 18 banks being requested to make the refunds.

Anthony averred that upon becoming aware of the incident, MPSBL’s management shut down the service to limit the impact and triggered engagements with the defendants (the 18 banks) through the Nigeria Inter-Bank Settlement System (NIBSS) for the commencement of recovery activities from the accounts of the various beneficiaries in the various banks.

He added: “We were able, through system checks, to confirm the banks and accounts into which the various sums of money were transferred into.

“We were also able to confirm how much was paid into each bank account in total. The said list of accounts which received the funds was made available to the respective banks as a preliminary step to mitigate the applicant’s losses.

“The transfers were due to the fact that the plaintiff suffered a system exploitation which led to the said debits.

“There is no transaction between the plaintiff and the recipient account holders that warranted the transfer of the funds to those account,” he said.

Anthony added that his organisation’s resort to the court was informed by the banks’ insistence that they needed to be ordered by the court before they could act.

The MPSBL CEO stated that the organisation was “carrying out investigations internally and externally to ascertain the actual cause of the debits”.

He added: “The defendant banks have requested an order of court mandating the defendant banks to reverse the credits made into their customers’ accounts before the defendants can do so. “

“The plaintiff is entitled to a return of its money and has demanded the return of the money into its settlement account in the name MOMO PSB settlement account number: 2041379385 held in First Bank Plc, Samuel Asabia House, 35 Marina, Lagos.

“It is the understanding of the plaintiff that prior to the defendant banks being informed of the fact that the credits into their customer accounts were unauthorised that some withdrawal transactions had already been carried out by some of the customers.

“This has necessitated the application for information regarding these customers and the banks and accounts to which they transferred the said funds in order to enable the plaintiff to trace the funds to those banks.

“By virtue of the provisions of the CBN Regulation on Instant (Inter-Bank) Electronic Funds Transfer Services, made pursuant to sections 2(D), 33(1)6) And 47(2) of the CBN Act 2007 the plaintiff is entitled to a return of its money and the provision of the information which it requires from the defendants.

“The plaintiff is also entitled to the support of the defendants in the recovery of any sums which have been removed from the customer accounts in the defendant banks the reliefs it is aiming in this action.”

The plaintiff is praying the court for the following reliefs:

… A declaration that the deposits of an aggregate sum of N22,300,000,000.00 erroneously transferred by the plaintiff to the accounts of the customers of the defendant banks, having been done in error, belong to the plaintiff and not the customers of the defendant banks.

… An order directing the defendant banks to each, individually, account for the sums available in their customers’ accounts and the sums which have been removed by the customers and are no longer available.

… An order directing the defendants banks to immediately return the aggregate sum of N22,300,000,000.00, less those funds that are no longer available, to the plaintiffs settlement account in the name MOMO PSB settlement account number: 2041379385 at First Bank Plc Samuel Asabia House 35 Marina, Lagos, from where the funds originated.

… An order directing the defendant banks to release all information, including account name information in respect of the accounts from which the plaintiff’s funds have been transferred to third parties, including the destination accounts and the banks in which they are held to assist in the tracing and recovery of those funds.

Fraud

Financial Scandal: Deputy CBN Governor Aishah Ahmad Detained Over $300 Million Bank Deal Mystery

Published

3 years ago

September 10, 2023

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In a startling development this weekend, the Department of State Services (DSS) took Mrs. Aishah Ahmad, the Deputy Governor of the Central Bank of Nigeria (CBN) overseeing Financial System Stability, into custody.

The focal point of this action is centered around Titan Trust Bank’s (TTB) controversial takeover of Union Bank. Ahmad is undergoing intensive questioning about TTB’s $300 million funding source used for the Union Bank acquisition.

Back in December 2021, Titan Trust Bank, then Nigeria’s emerging financial entity, clinched a deal with Union Bank after primary stakeholders offloaded a significant 89.39% of their stake. In a joint statement released on Thursday by both banks, the acquisition is pending regulatory green lights and various other financial criteria. Should it materialize, TTB will command an 89.39% stake in Union Bank’s share capital.

The statement elaborates, “Union Bank’s board today informed NG X and the Securities Exchange Commission of an agreement between its investors — Union Global Partners Limited, Atlas Mara Limited, and others — and Titan Trust Bank. The pact concerns the divestment of their Union Bank stakes in favor of TTB.”

Union Bank’s erstwhile chairperson, Mrs. Beatrice Hamza Bassey, spoke positively about the acquisition, expressing optimism about the post-approval phase. She praised the bank’s present investors for their transformative contributions over the past decade to one of Nigeria’s most enduring financial institutions.

A update also brought to the fore Mrs. Aishah Ahmad’s appointment by the previous President, Muhammadu Buhari, in October 2017. Before this, she rendered her expertise as an Executive Director at Diamond Bank Plc. She filled the shoes of Dr. Sarah Alade, who vacated the Deputy Governor, Economic Policy role at CBN earlier in March 2017.

Fraud

Fidelity Bank boss advocates measures to curb e-fraud challenges

Published

3 years ago

August 21, 2023

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Managing Director/Chief Executive Officer, Fidelity Bank Plc, Mrs. Nneka Onyeali-Ikpe has called on the Nigeria Electronic Fraud Forum, NeFF to come with solutions to the challenges posed by electronic fraud to financial system.

According to a report published in Vanguard Newspaper, she made this call in Lagos while speaking at the 3rd quarter general meeting of NeFF.

Nneka Onyeali-Ikpe explained that e-fraud are activities carried out online to exploit individuals and business entities for financial gain.

She listed examples of e-fraud to include: Phishing; Advanced fee fraud (419); Online Auction Fraud; Identity Theft; Tech Support Scams; Online Romance Scam; Investment Scam; Business Email compromise; Ransomware; Online Rental Schemes; Pyramid Schemes; and Click Fraud.

Highlighting the rising trend of e-fraud in the country and the associated challenges, the Fidelity Bank boss said: “According to data released by NIBSS, the value of electronic payment transactions in Nigeria increased by 298% YoY from N34.04 trillion in Q1 2022 to N135.52 trillion in Q1 2023.

“As technology continues to advance at an unprecedented pace, our reliance on digital transactions has grown exponentially. However, with this rise in digital interactions, the threat of e-fraud has become a significant challenge affecting individuals, businesses, and industries alike.

“The banking industry lost a total of N14.3 billion to electronic fraud in 2022, up from the N12.7b reported in 2021. As at Q1 2023, the total fraud loss was N5b according to the NIBSS Annual Fraud Landscape reports.

“The Mobile channel is the most exploited channel by fraudsters in 2021 and 2022 with 42,821 and 45,090 reported fraud records respectively. Total fraud count in 2021 was 123,918 and 101,668 in 2022.

“E-fraud has permeated multiple industries, spanning from banking and finance to e-commerce and beyond. These cybercriminals leverage advanced methods to exploit vulnerabilities, gaining unauthorised access to crucial data and funds. The repercussions of e-fraud are not limited to financial losses; they also extend to eroding trust and eroding brand reputation.

Fraud

Lotus Bank of Fraud: Customer Laments As N20M Disappeared From Her Account, Reveals Why Nigerians Shouldn’t Trust The Bank

Published

3 years ago

May 23, 2023

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Lotus Bank finds itself embroiled in controversy as a customer comes forward, alleging that the bank tampered with her account and failed to compensate her for an erroneous reversal of funds. The customer claims that Lotus Bank deleted transaction records and invaded her privacy, raising serious concerns about the bank’s ethics and practices.

According to the customer, on March 12, 2023, she attempted to transfer twenty million naira (20,000,000) from her account, but the transaction failed and the money was not reversed immediately. After contacting Lotus Bank, she was assured that the reversal would be processed due to network issues. However, despite waiting for several days, the 20 million naira reversal did not occur, causing her distress and frustration.

Unexpectedly, on March 15, the customer began receiving multiple alerts of reversals, lasting for several hours. Astonishingly, Lotus Bank mistakenly reversed an exorbitant amount of one billion, eight hundred million naira (1,800,000,000) into her account while attempting to reverse the initial twenty million naira (20,000,000). Realizing the error, she promptly informed the bank of the erroneous reversal and the involved amount.

In response, Lotus Bank promised to compensate her but requested permission to withdraw the excess amount. The customer granted permission, and for three days, the bank left the 1.8 billion naira in her account without completing their withdrawal. However, during this time, Lotus Bank allegedly tampered with her account and erased all records related to the reversal, including SMS alerts, email notifications, and even the statement of account showing the erroneous transaction. Furthermore, the bank deleted all other recent transaction records, including transfers and POS transactions.

Disturbed by the situation, the customer visited her bank to complain and request a statement of account. It was during this process that she discovered the extent of the tampering by Lotus Bank. The bank’s actions not only violated privacy and banking ethics but also left her without any record of recent transactions, including failed transfers. As a result, she was unable to provide sufficient evidence to support her claim.

Lotus Bank has yet to provide any transaction history to refute the customer’s allegations, leaving her and others questioning the bank’s credibility. The customer is seeking redress for the failed transaction and the promised compensation that Lotus Bank has seemingly reneged on. The incident has raised concerns about the bank’s practices and highlights the need for the Central Bank of Nigeria (@cenbank) to investigate the matter thoroughly.

As the situation unfolds, Lotus Bank faces mounting pressure to address the customer’s claims and demonstrate transparency in their operations. The affected customer, supported by screenshots taken during the reversal process, hopes for a resolution to her ordeal and urges the bank to fulfill its responsibilities promptly. The involvement of the Central Bank of Nigeria is seen as vital to ensuring a fair and impartial investigation into the alleged misconduct by Lotus Bank.