UBA Customer Petitions CBN Over N1.2m Fraud; What Alawuba Said

Oliver Alawuba, the Chief Executive Officer, CEO, of the United Bank for Africa, UBA has made a strong case for commercial banks in the country to strengthen their internal mechanism against fraud. Failure to do this, the UBA CEO said must attract ‘harsher’ penalties from the regulators like the Central Bank of Nigeria, CBN, and others.

Alawuba made the  remark  at the Annual General Meeting and Fraud Conference of the Association of Chief Audit Executives of Banks in Nigeria, ACAEBIN.

The key regulators over-sighting Nigeria’s commercial banks are the Central bank of Nigeria, CBN,  the Nigeria Deposit Insurance Corporation, NDIC, the Securities and Exchange Commission, amongst others. They have the powers to sanction banks accused of infractions against customers, particularity when it comes to the issue of fraud.

The UBA chief executive spoke amidst regular complaints, by customers, that  monies are missing from their accounts without knowledge.

According to UBA’s 2024 Audited Financial Statement the commercial bank lost  a total of N1.14 billion to fraud, the amount is more than the Profit After Tax, PAT recorded by one commercial bank in the country in the 2023 Financial year, highlighting UBA’s vulnerability to large scale fraud, experts insist.

Teach Cabal in a report said for more than 12 years the Alawuba-led commercial bank had refused to capture the amount it lost to fraud in its Financial statement, for reasons best known to its management.

The bank however insist that it has a water-tight system against fraud, saying employees who commit fraud are small boys who are not involved in the day-to-day management of the bank.

“There is no fraud involving management or other employees who could have any significant role in the bank’s internal control,” the bank said in the financial statement.

But one of its customers who lost money to wire fraud has a reason to disagree.

“What customers are facing today, from their banks, regarding fraud is unprecedented, the regulators must do more to rein in some of these banks, by bringing down the hammer,” a forensic expert said on Monday.

He’s right.

For weeks, a UBA customer, Dannytech Solutions Services Ltd

@melvin7505 has been trying to get back, over N1. 2 million debited from his account without his authorization. The customer said he has become really frustrated because UBA shunned him, and refused to solve his problem.

According to him,  the only way to get his hard earned money back from the bank, is for the Central Bank of Nigeria, CBN to intervene.

His petition is contained in a message he shared on the bank’s X handle, which he said has been copied to the CBN.

In the heart rendering message to the Bank, the customer said he has ‘reported’ the issue to the apex bank for intervention, pleading that the ‘money’ stolen from his account be immediately ‘reversed’.

His problem with the bank started in February this year, when he was wrongly debited, and since then the bank has been dilly-dallying on the issue, he was initially assured that the problem will be resolved within a few days of the theft, but ‘up till now” UBA has ignored the alleged “fraud” committed against him.

“I did a transaction of 1.2 million since last week 27th February uba debited me asking me to wait till 4th of March up till now I have not seen my money… please uba please reverse my money for God’s sake I have reported you people to cbn Nigeria gov.. reverse my money. UBA Customer Petitions CBN Over N1.2m Fraud.”

‘The question is whether the UBA’s intention is to frustrate the customer because their action has not proven otherwise. Was the money debited thinking that the customer ignores. Because this is what banks do to many rich guys, many who have no idea of what they actually have in their account. May be the reason the case of this customer became an issue is because he’s not among those big guys who don’t have an idea of what their balance looks like because they have so much more,” a financial expert said.

“This does not portend well for a bank whose chief executive has preached against fraud, and the need to protect the customer. Nigerians, and indeed the banking public are watching how Alawuba and his management will resolve this controversy, by ensuring that the customer got his money back,’ the source stated.

Adding “failure to resolve the issue immediately in favour of the customer and other fraud cases against the bank’s customers where the bank has yet to act,  the CBN must immediately intervene,” he said.

Alawuba makes the case for banks to strengthen internal control measures against fraud, failure to do that, he explained,  must attract severe penalties.

“Internal audit functions must be truly independent. Whistleblowers’ protection, surprise checks, and continuous monitoring.

“Regulatory enforcement and accountability. Fraud must carry severe consequences. Regulators must impose harsher penalties on financial institutions that fail to enforce internal fraud controls,” he said.