Moruf Oseni’s Wema Bank Faces Multi-million Naira Penalties For Violating Nigerian Cyber security Laws

Fastnewsngr reports that a recent investigative report obtained by online newspapers has shed light on WEMA Bank’s legal entanglements in 2023, with the financial institution facing penalties totaling N61.350 million for contravening seven Nigerian laws within a single year.

The revelations surfaced from WEMA Bank’s comprehensive financial statement for the fiscal year 2023, which unveiled a series of legal breaches. Among the laws violated were cybersecurity regulations, sections of the Bank and Other Financial Institutions Act (BOFIA) 2020, and Central Bank of Nigeria (CBN) directives concerning Know Your Customer (KYC) protocols.

Specifically, WEMA Bank incurred fines amounting to N2 million for failing to comply with cybersecurity frameworks and N20 million for breaching Section 19(3A) of BOFIA 2020. Additionally, penalties of N17.45 million were imposed for violations of CBN circulars on KYC requirements.

The bank also faced financial repercussions, including a N10 million fine for the late submission of final returns and N8 million for breaches in Risk-Based Supervision (RBS).

Furthermore, a penalty of N2 million was levied for regulatory breaches related to CBN clearance, while a N1.9 million fine was imposed for the delayed filing of its 2022 audited financial statements with the Nigerian Exchange Limited (NGX).

Despite grappling with legal challenges, WEMA Bank reported a decrease in losses attributed to fraud and burglary incidents, amounting to N256.387 million in 2023, compared to N880.154 million in the previous year. This reduction signifies efforts undertaken by the bank to combat fraudulent activities, as noted by credit risk analyst Mr. Osai Djemba, who emphasized the need for implementing advanced security measures such as artificial intelligence to mitigate theft risks.

Meanwhile, unresolved complaints lodged against WEMA Bank decreased to 9,974 by December 2023, down from 13,642 in the corresponding period of 2022. Notably, customers with unresolved complaints demanded compensation totaling N10.843 billion, prompting the bank to refund N11.258 billion (in addition to the N10.843 billion).

In response to these challenges, WEMA Bank highlighted its commitment to enhancing customer experience, citing a 60% reduction in the average resolution time for complaints compared to 2022 and an increased resolution rate from 93% to 98%. These initiatives underscore the bank’s dedication to addressing regulatory concerns and improving service delivery for its clientele.