Recently, one of my banks forced its customers to patronise ATMs by cancelling across-counter withdrawals below a certain amount. Curiously, it also introduced charges (N10, later increased to N50) for each ATM withdrawal at its own terminals in addition to monthly ATM charges and SMS charges.
Recently, one of my banks forced its customers to patronise ATMs by cancelling across-counter withdrawals below a certain amount. Curiously, it also introduced charges (N10, later increased to N50) for each ATM withdrawal at its own terminals in addition to monthly ATM charges and SMS charges.
These are in addition to COT charged on Current Accounts, and these are charged on withdrawals from Savings contrary to usual banking norms. The same bank reversed without discussions and by direct debit, interests credited to customers’ savings accounts over 12 months for undisclosed reasons. I sought online information from Wikipedia and other internet sites on that mainstay of Nigerian Banks: Commission on Turnover (COT) but to no avail. It was not easily found in the list of accepted bank charges. In fact, I only found information on it with respects to Nigerian Banks. Nigeria appears to be the only jurisdiction where a customer pays his bank for the privilege of keeping and trading with his funds rather than receiving interest thereon. A friend applied for a naira credit card advertised by another bank last year. The advertised interest was 6%. Upon enquiry, bank officials orally said it was per annum; signed documentations were silent on this aspect. Upon drawing on the credit, he discovered that he was being charged 6% flat (i.e., a compounded monthly interest) which translated to over 76% p.a. Insider sources reveal that over 12, 000 defaulters have been recorded by the bank on this service. His every attempt to correct this anomaly was rebuffed by the bank. On one occasion, a female bank manager told him with insufferable arrogance that the terms were irreversible and he should ‘take it or lump it’. My friend has decided to ‘lump it’ by calling the bank’s bluff. Another client pledged various quoted shares worth several millions as collateral for an overdraft facility for his import business. He subsequently instructed his bank to sell his shares in a particular company to take advantage of a rise in its prices prior to the closure of its register. The proceeds were to be held by the bank as further cash backed collateral for the facility. The proceeds would have actually enabled him to liquidate the facility, with sufficient remaining to repurchase the shares some months later when he anticipated a drop in the shares’ value. Unfortunately, the bank failed to carry out these instructions, having lost the shares. He was not informed of this until after three months. To add insult to injury, the bank sought to unilaterally roll over the facility and added several new nomenclatures of charges to enable them extract as much from the situation as possible whilst looking for the missing certificates. These support submissions by Adeyemo Olukoya, a Forensic Accountant that Nigerian Banks practice fraud and shady practices against their public/private customers. Banks charge several dubious and excessive fees on customers. The regulatory authorities apparently condone/connive with our bankers to fleece the banking public. Banks reportedly prepare different audited reports for CBN, NDIC, FIRS and State Revenue Services1. I heard of these cooked books over 15 years ago. How come the regulatory agencies have been unable to put a stop to these alleged malpractices till date? According to a report: The audited financials sent to the CBN is usually profit-inflated since it is that same audited accounts that would be published showing bogus profits in order to make their shares attractive at the capital market after compromised approval has been given by the CBN. For the same period, the audited accounts that would be forwarded to NDIC would have a depleted deposit base in order for the banks to pay as little as an infinitesimal fraction of one percent insurance premium to NDIC. For the same accounting period too, the audited accounts that would be forwarded to the FIRS would have a reduced profit so that these banks would not pay any corporate tax to the coffers of the Federal Government of Nigeria while at the same time concealing Withholding Tax and VAT deductions, thereby defrauding the Federal Government of revenues due it. Lastly … financials going out to States IRS would contain drastically reduced salaries and wages to prevent paying appropriate Pay-As-You-Earn (PAYE) and Withholding Tax to the various state governments. So there is a whole gamut of conspiracy going on in the banking sector which we had set out to establish and expose accordingly.2 The notorious practice of ‘deposit chasing’ by these banks is another area of concern. It has exposed their marketing officers (male and female) to compromising situations all in an effort to meet unreasonable deposit targets imposed on them. Recently, a young lady was in my office to encourage me to revive my account with her bank. I had let it go dormant because of their poor services. She introduced herself as my new account officer. After listening to her, I asked her if it was her habit to go to offices unaccompanied. She smiled and replied in the affirmative. ‘Assuming, I make a pass at you now and lock my office door to ensure I have my ‘way’ nko?’ I asked. She looked quite alarmed and I quickly assured I was kidding. I however drove home the folly of seeking deposits so naively and advised she team up with a colleague for these trips. Thankfully, she took to my advice as I often saw her with a female colleague around Ikeja thereafter. My discussions with banker colleagues showed that the banks’ are aware of what some of these girls do or go through to secure deposits. They just couldn’t care less. Some reportedly even organise ‘prayers’ for successful deposit drives by their staff: how curious? I often wonder, as I hear news of Nigerian banks opening branches in the West, how these over-bloated banks operate in such societies. Many of these shady dealings go on with the active connivance of Central Bank officials who often turn a ‘blind eye’ on their illegal deals for clearly pecuniary considerations. According to recent reports: The governor of the CBN, Professor Chukwuma Soludo who was taken aback owing to some of the revelations indicting the banks, said that henceforth, the apex bank would “come down heavily on any bank or officials that refuse to play the banking game according to the rules.” Soludo said that the apex bank in accordance with the laws establishing it may go as far as dissolving the board, suspending the management staff, or other staffers involved in scams, it would also impose fines as sanctions or even withdraw the operating license of defaulting outfits, depending on the offence(s).3 However, CBN has parroted such threats before. It has become like the bark of a toothless Bulldog. Bank officials often dare angry customers to report to CBN. They know CBN would at best only refer complaints to the Bankers’ Committee; which is composed of senior officials of the same banks in breach of a cardinal principle of natural justice: nemo judex in causa sua (no man shall be a judge in his own cause). Nigerian Banks have with the consent of the CBN and other regulatory authorities perfected a situation for their customers where heads or tails, the customer loses and the banks smile to their over-bloated vaults. For many customers in dealings with their banks: the more you look, the less you see.
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The views expressed in this article are the author’s own and do not necessarily reflect the editorial policy of SaharaReporters
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