The Central Bank of Nigeria (CBN) warned that serial issuers of dud cheques will henceforth be prevented from accessing credit facilities from the banking system for a period of five (5) years.
In a letter to all banks with reference number BSD/DIR/GEN/LAB/08/016 the apex bank said it has noted with great concern the impunity with which some customers of banks issue dud cheques on their accounts despite the provisions of the Dishonoured (Dud) Cheques Act of 1977 and CBN’s recent directives to banks’ customers to desist from such practice.
It said that in order to sustain the positive achievements already recorded in the Nigerian Payment System, it is essential that confidence and integrity in negotiable instruments, especially cheques, should be restored and enhanced.
Hence, it has become imperative for the CBN to implement further measures to dissuade the issuance of dud cheques to the barest minimum.
The letter signed by the Director of Banking Supervision, Mrs.Tokunbo Martins read in part:
“ Upon CBN’s compilation and dissemination of information on serial issuers of dud cheques based on bank’ returns, banks would be required to;Recall/cancel all unused cheque books issued to serial issuers of dud cheques; Bar the affected customers from use of the clearing system for a period of five (5) years; Forward the names of Dud Cheque offenders to the three Private Credit Bureaux and the Credit Risk Management System (CRMS).”
It further stated that the customers’ names would be listed on the database of the private credit bureaux and CRMS for a period of five (5) years from the date of submission, after which offenders will be eligible for removal. However, if the offender is found wanting after the name is removed, such an offender shall be permanently reinstated in the data base of both the three (3) Credit Bureaux and the CRMS; Bar the serial issuers of dud cheques from accessing credit facilities from the banking system for a period of five (5) years.
The bank warned that no institution shall, except with the prior written approval of the CBN, remove such a person’s name from the three Credit Bureaux and the Credit Risk Management System (CRMS).
It said banks should perform status check on a potential customer from CRMS and at least two Credit Bureaux before on-boarding such a customer.
CBN adopts whistle blowing method to monitor staff
Members of staff of the Central Bank of Nigeria (CBN) may have to be more ethical in the discharge of their duties as the bank has established a whistle blowing policy to monitor their activities.
In pursuit of zero tolerance standards of honesty and integrity, the CBN said it has put in place a monitoring procedure to ensure that business ethics and professionalism are applied by
its members of staff performing their duties in financial institutions.
The bank therefore requests full cooperation of the banking public, which involves reporting any unethical practice(s) that
borders on dishonesty and lack of integrity among others, in the action/behavior of
CBN staff that visit institutions in the course of performing their duties.
Such report(s) or observation(s) it said, which should contain detailed information to
enable it act promptly, should be sent directly, confidentially or anonymously by
post to: Head, Ethics & Anti-Corruption Office Governors’ Department Central Bank of Nigeria
No. 31 TafawaBalewa Street Central Business District Abuja, FCT.
“Alternatively, the report could be sent by e-mail to: firstname.lastname@example.org, email@example.com or by telephone to 09-46239246 & 09-46236000.”
The apex bank, had in the past, mandated banks and other financial institutions to implement mechanisms that facilitate whistle-blowing which protects the identity of the blower or the individual making public disclosure of corruption or wrongdoing in the system. It was believed that through its implementation the prevalence of misconduct and breaches of corporate governance in such organizations will likely decrease over time.