FRAUDULENT WITHDRAWALS: First Bank to Pay Multi-million Naira Damages to Customer over Negligence

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*By Emmanuel Edom*

For the alleged negligence, unauthorised fraudulent withdrawals from a customer’s account, a High Court sitting in Lagos, has ordered First Bank Plc, to refund the total sum of One million, Two Hundred and Seven Thousand, Five Hundred Naira, being the alleged money stolen.

The court also ruled that First Bank should pay over Twenty Million Naira to the aggrieved customer as general damages and interest on stolen fund, and for the banks alleged act of negligence and refusal to investigate the repeated theft.

The Banks customer, Mr. Abiodun Foluso, an insurance broker and former employee of Leadway Assurance Company Limited, had through his lawyer, Mr. Macaulay Ugwummadu, filed a suit delineated as Suit No: ID/738/2012, against First Bank Plc, as Defendant, where he as the Claimant averred that his First Bank Account Number 2007721366 domiciled at the Abebe Village Road, Branch, was fraudulently tampered with, making it impossible to withdraw money with his ATM card.

According to him, despite his oral and written complaints dated 15th May, 2009, the bank neglected, failed and or refused to either respond to the complaints or rectify the anomaly.

Foluso, further averred that the bank’s indifference to his complaints, compelled him to send more petitions to the different units of the bank as well as the Central Bank of Nigeria (CBN), which after a considerable period of delay, First Bank invited him to identify three different footages showing pictures taken during the alleged fraudulent transactions, which he stated that the two images were total strangers.

In the amended statement off claim, Foluso also averred that “Notwithstanding this shocking revelation about the fact of unauthorised transaction on the Claimant’s account by person(s) not known to or authorized by the Claimant, the Defendant failed, refused and neglected to conduct a thorough investigation into this glaring case of fraud as a responsible, diligent and customer friendly financial institution would have been done in such circumstance.

“The defendant proceeded instead to write a letter dated 3rd August, 2009 by way of response to Claimant’s letters of protest, excoriating and berating the Claimant on his ordeal and even accused the Claimant of compromising his ATM pin thereby exculpating itself from this glaring case of fraud”.

In his particulars of negligence, Foluso stated, thus: “Only the Claimant and the Defendant know the ATM PIN number ascribed to the Claimant, and it is when the Claimant insert the card into the machine and pressed in the correct pin numbers that money would be dispensed by the Defendants ATM machine to the Claimant”.

Therefore, Foluso urged the court to uphold the declaration that the failure of the Defendant to investigate the theft of N38,000.00 on the 10th of May, 2009 by some persons unknown to the Claimant as well as alert the Claimant of the said theft is unlawful, amounts to negligence and a breach of contract.

Another declaration that the action of the Defendant by its refusal to stop the unlawful and unauthorised withdrawals from the Claimant’s account amounting in the aggregate of N1,207,500.00 (One Million, Two Hundred and Seven Thousand, Five Hundred Naira) even after series of protests and complaints by the Claimant to the Defendant amounts to negligence and a breach of contract.

An order of court directing the Defendant to immediately credit the account of the Claimant with the sum of N1,207,500.00 (One Million, Two Hundred and Seven Thousand, Five Hundred Naira) representing the aggregate sum unlawfully withdrawn from the Claimant’s account, with interest at the rate of 21% on the said sum to the Claimant from the date of the transaction till judgment.

He also pleaded for an order of court directing the Defendant to pay interest at the rate of 15% per annum of the judgment sum from the date of judgment until when the judgment sum is fully liquidated.

A further order of court directing the Defendant to pay the Claimant the sum of N10,000,000.00 (Ten Million Naira) only as general damages for the Defendant act of negligence which has led to the loss of Claimant’s money with the defendant and the failure and/or refusal of the Defendant to thoroughly investigate the repeated theft from Claimant’s account and forestall same even after the Claimant had submitted his ATM card to the Defendant.

In his judgment dated June 20th, 2018, the presiding judge, Honourable Justice A. A. Oyebanji, granted all the reliefs sought by the Foluso, except that of the aggravated damages.

 




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