Senate to Probe CBN, Banks Over Illegal Charges, Deductions

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  • Senate to Probe CBN, Banks Over Illegal Charges, Deductions

The Senate on Tuesday resolved to conduct an investigation into the spate of illegal charges and deductions from accounts of their customers by Deposit Money Banks.

The resolution followed the adoption of a motion moved by Senator Magnus Abe and 22 others, entitled, ‘Urgent Need to Investigate, Regularise and Amend Conflicting, Vague and Unjust Remedies, which the Central Bank of Nigeria Offers to Victims of Excessive and Arbitrary Bank Charges and Illegal Deductions by Commercial Banks.’

One of the prayers of the motion, which was passed unanimously by the lawmakers, was to urge the government to “pro-actively protect customers’ rights, eradicate short payment of interests and end the culture of excess and arbitrary bank charges; these steps if taken, will reposition the banks to avert future re-occurrence.”

The lawmakers also revolved to direct the Senate Committee on Banking, Insurance and Other Financial Institutions to conduct a public hearing and invite the Governor of the Central Bank of Nigeria, Godwin Emefiele, his officials and other stakeholders, such as forensic auditors, managing directors of commercial banks and the Bankers’ Committee.

The public hearing, they resolved, would be aimed at “harmonising and amending these laws, rules and guidelines that do not adequately protect the customers and give them substantial remedy when overcharged.”

Moving the motion, Abe said, “The Senate notes that over the years, commercial banks in Nigeria have indulged in sharp practices of overcharging customers/depositors arbitrarily and excessively, contrary to tariff stipulations and credit and monetary guidelines issued from time to time by the Central Bank of Nigeria.

“The Senate is aware that the CBN reported that it had recovered about N2.6bn from banks as excess charges imposed on their customers in 2015 through a statement issued by the Director, Corporate Communications Department, Muazu Ibrahim. In 2015 alone, the apex bank investigated about 6,000 of such cases;

“The Senate is concerned that several of the Central Bank of Nigeria’s applicable rules that should remedy such hardships and discourage sharp practices by the commercial banks are conflicting, vague and unjust, thereby causing the commercial banks to frequently short-change their customers.”

The lawmaker decried that requests by bank customers to the CBN for clarification of the rules were largely ignored.

“The Senate is worried that if this trend is allowed to continue unabated, Nigerians will be worse of for it, while the commercial banks will continue to declare huge profits at the expense of innocent Nigerians from regular depositors to business firms,” Abe added.

Seconding the motion, Senator Emmanuel Bwacha described as fearful what he called monumental fraud in the banking sector.

“In an era that we claim to be fighting corruption and we ignore this sector, I think we are just doing eye service to the fight against corruption. This is one critical area that if we focus on, it will save a lot of Nigerians from the pains they are going through,” he said.

The President of the Senate, Bukola Saraki, in his remarks, said the lawmakers would defend Nigerians.

He stated, “Particularly at this difficult time, every naira is important and we must be seen to be defending the interests of Nigerians who don’t have the voice to defend themselves.

“Again, the issue here is to get to the bottom of what the laws and guidelines are, and to be sure that they (banks) are in line with the laws and have the powers to make such pronouncements (on charges).”

About the Author

Samed Olukoya
Samed Olukoya is the CEO/Founder of investorsking.com, a digital business media, with over 10 years experience as a foreign exchange research analyst and trader.

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