WEMA Bank penalties of N61.350 million in 2023 due to violations of seven Nigerian laws.
By The Tochlight Africa News
The bank’s financial statement for the year revealed that it breached a cybersecurity law, a section of the Bank and Other Financial Institutions Act (BOFIA) 2020, and the Central Bank of Nigeria (CBN) circulars on Know Your Customers, among others.
Concerning the cybersecurity framework violation, Wema Bank was fined N2 million, while a fine of N20 million was imposed for contravening Section 19(3A) of BOFIA, 2020.
Additionally, the bank had to pay N17.45 million for non-compliance with the CBN circulars on KYC. The late submission of final returns resulted in a fine of N10 million. The CBN circulars on KYC aimed to combat money laundering and other financial crimes.
The CBN emphasizes the importance of having sufficient customer information and utilizing it as an effective tool against money laundering. It also provides protection against fraud, reputational and financial risks, and enables financial institutions to identify suspicious activities.
Furthermore, Wema Bank faced a penalty of N8 million for Risk-Based Supervision (RBS) breaches. The bank was also fined N2 million for a regulatory breach regarding CBN clearance.
For the delayed filing of its 2022 audited financial statements with the Nigerian Exchange Limited (NGX), the tier-2 lender incurred a fine of N1.9 million.
Although fraud and burglary remain significant risks for the bank, the losses incurred in 2023 amounted to N256.387 million, which was considerably lower than the N880.154 million lost in 2022.
According to credit risk analyst Mr. Osai Djemba, the bank implemented measures in 2023 to address fraud and theft. He emphasized the importance of introducing artificial intelligence measures to minimize theft, as sophisticated criminals have infiltrated the Nigerian financial system intending to steal, harm, and cause destruction.
In December 2023, Wema Bank had 9,974 unresolved complaints, which is a decrease from the 13,642 complaints reported during the same period in 2022. These complaints resulted in customers demanding a total of N10.843 billion from the bank.
However, the bank’s financial statement revealed that they refunded N11.258 billion to customers, excluding the N10.843 billion demanded. The bank attributed this success to its initiatives, which led to a 60% reduction in the average time taken to resolve customer complaints compared to 2022.
Additionally, the resolution rate increased from 93% to 98%, showcasing the bank’s dedication to consistently and efficiently improving the customer experience.