Banks lobby AGF over deposit forfeiture

Deposit Money Banks

Deposit Money Banks are lobbying the Office of the Attorney General of the Federation to step down on the seizure of monies in the bank accounts of customers without the Bank Verification Number by the Federal Government.

A Federal High Court in Abuja had ordered the forfeiture of all monies in bank accounts owned by corporate organisations, government agencies and individuals without the BVN.

The forfeiture order, which was issued by Justice Dimgba Igwe, while ruling on an ex parte application filed by the Federal Government through the Office of the Attorney General of the Federation, is not final yet.

The owners of the accounts had 14 days to claim ownership of same and show cause why the amounts in them should not be permanently forfeited to the Federal Government.

The court also ordered the banks to advertise the accounts without the BVN in a widely circulated national newspaper as notice to those who might have any interest in them.

The court gave the order on October 17 following an application that was filed on September 28.

Justice Dimgba adjourned until November 16 for the hearing of the substantive application seeking the forfeiture of the sums in the accounts without the BVN.

The judge ordered the banks to file an affidavit of disclosure before the court, showing the names of the affected accounts, the account numbers, outstanding balances, domiciliary accounts and the bank branches where the accounts were domiciled.

The court directed that the order be equally served on the Central Bank of Nigeria.

Our correspondent gathered on Sunday that although the banks had started compiling the lists of accounts without the BVN, they were not in a hurry to publish the details of such accounts, especially before the November 16 scheduled for the substantive hearing on the case.

The executive director of one of the banks, who spoke on condition of anonymity, said, “The banks are lobbying the AGF; we hope to get them to understand why they should not carry out such an order. This money belongs to private people. Why will the government seize what belongs to them?

“Most of the customers who have yet to comply have one reason or the other for not doing so. Some are abroad; some don’t have the time to link the BVN to all their bank accounts; some have issues relating to estate and the need to get a letter of administration.”

The ED noted that such an action might send a wrong signal to foreign investors and the international community.

The chief executive officer of a mid-size bank told our correspondent that the government had no business asking private depositors to forfeit their funds for failing to obtain the BVN.

The CEO said, “If you cannot prove that the proceeds in such accounts are from illegal sources, then it is shameful for the government to do that. Government knows how to trace those accounts with monies that are proceeds of crime. Government cannot just seize private funds. It will create confidence crisis and several legal battles. We are talking to them as a group and we hope that the government will get to understand us.

“Some people have been outside the country for some time now. There are not enough centres overseas to enable them obtain the BVN there. Some have issues relating to estate. Some don’t have time to link the BVN to their bank accounts.”

Named as defendants in the suit are Access Bank Plc, Citi Bank Nigeria, Diamond Bank Plc, Ecobank Nigeria, Fidelity Bank Plc, First Bank of Nigeria Limited, First City Monument Bank, Guaranty Trust Bank Plc and Heritage Bank Plc.

Other banks are Keystone Bank, Skye Bank Plc, Stanbic IBTC Bank Plc, Union Bank of Nigeria Plc, United Bank for Africa Plc, Unity Bank Plc, Wema Bank Plc, Zenith Bank Plc and the CBN.

An industry stakeholder, Mr. Johnson Chukwu, had said there was a need for the Federal Government to give more time to enable rural dwellers to comply with the BVN requirement.

According to him, most of the learned bank customers have complied, and the majority of those who have yet to comply are illiterate people dwelling in the rural places.

He stated that the CBN needed to communicate through local languages in order to get the rural dwellers to comply.

“Another  category of people who have not complied are those who opened the bank accounts with fictitious names, or those who got their money through illegal or criminal proceeds, and will not want to come up to claim ownership of such accounts. These people constitute the highest amount in terms of the value of the money,” he added.

Some bank officials said there were certain accounts that the institutions could not link up due to names mismatch.

The President, United Labour Congress, Mr. Joe Ajaero, faulted the court order asking the CBN to freeze all bank accounts without the BVN.

He said, “I do not agree with the court. The court should have taken into consideration that most owners of those accounts have not been around to register for the BVN, or are incapacitated to do so now.

“We are aware that a good number of the account bearers have been out of the country and cannot get the BVN until they return, while others have been indisposed over the years due to severe health challenges.

“The right thing would have been an order asking the banks to suspend the operation of such accounts pending when the BVN will be allocated to the accounts.”

A Senior Advocate of Nigeria, Mr. Ifedayo Adedipe, had said though the Federal Government should be commended for the BVN policy, it was unconstitutional for citizens to be ordered to forfeit their money over failure to supply the number.

Adedipe said, “I think the objective of the BVN policy is to enable the government to track accounts and individuals who own them. If we are serious about fighting money laundering and financial crimes, I think that is a commendable step.

Another SAN, Mr. Seni Adio, had expressed reservation about the order, saying there was a question mark on its constitutionality.


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