CBN Mandates Watchlist for Banking Infractions

CBN Mandates Watchlist for Banking Infractions

By Sahabi Abdul

The Central Bank of Nigeria has mandated the creation of a watchlist of Bank Verification Numbers to track and penalize bank customers guilty of various infractions.

Those deemed to have breached banking regulations will face penalties including freezing of owners bank accounts and other penalties, including fines, according to a circular on the website of the CBN.

“Once a breach is established, in the process of investigation/fair hearing, a customer’s account shall be placed on Post-No-Debit (PND), the customer shall be notified through verifiable means within five (5) business days,” the banking regulator said in the circular signed by Musa Jimoh, the director for payments systems management.. “At a minimum, the notification shall clearly state the breach and the consequences which include watch-listing.”

Affected customers will be given the opportunity to defend themselves, including presenting documentary evidence to back up their defence, according to the CBN.

The regulator identified itself, the Nigerian Inter-Bank Setement System Plc, banks as well as other financial institutions and their customers as concerned stakeholders in the implementation of the policy.

Offences for which BVNs can be put on the watchlist include fraud and other banking system malfeasance as may be determined by the regulator. Banks and other financial institutions can end business relationships with such individuals or organizations, the CBN said.

Account or wallet holders will also be barred from using automated teller machines, points of sale transactions, internet or USSD banking and the issuance of tbird-party checks. Such account holders won’t be able to act as referees for new accounts or as guarantors for people seeking credit facilities nor would be able to access credit themselves.

“However, inflows may be allowed, provided these are from legitimate sources,” the CBN said.