Excess bank charges as economic and financial crimes

The quantum of excess charges (more than N70 billion recovered for bank customers in the last few years) being witnessed in the country’s banking industry is a source of serious concern for many people who are silently and curiously questioning whether the charges qualify as “economic and financial crimes”. And if so, should the Economic and Financial Crimes Commission (EFCC) play any roles in check-mating these crimes that have sent businesses to their early graves, increased the number of unemployed people in the economy, impaired the well-being of many households and eroded confidence of many stakeholders in the Nigerian banking system? The two questions are heavily pregnant; and answers may bring forth off-springs that may tilt the apple cart.

According to USLegal.com “economic crimes refer to illegal acts committed by an individual or a group of individuals to obtain a financial or professional advantage. In such crimes, the offender’s principal motivation is economic gain”. Similarly, Encyclopedia.com states that “economic crime is an illegal act in which offenders’ principal motivation appears to be economic gain”. On the other hand, Wikipedia defines “financial crimes as crimes against property, involving the unlawful conversion of ownership of property (belonging to one person) to one’s own personal use and benefit”.

A merger of the two sides of the definitions of economic and financial crimes finds a working and practical expression in Section 5(1) (b) of Nigeria’s law on the subject. That law, Economic and Financial Crimes Commission (Establishment) Act 2002 enumerates acts considered to be economic and financial crimes. The listed acts are “advance fee fraud, money laundering, counterfeiting, illegal charge transfers, futures market fraud, fraudulent encashment of negotiable instruments, computer credit card fraud, contract scam, etc”. Notice the ‘etc’ in the provision which is indicative that economic and financial crimes as captured in the EFCC Act are in-exhaustive.

From the above definitions and formal identification of some crimes that fall within the catchment of the law, the answers to the questions earlier posed are obvious. Simply put, excess bank charges qualify as forms of economic and financial crimes. It is not in doubt that, to make economic gains is what motivates banks to impose excess charges on their customers. The banks that make such charges illegally convert the assets/property (money) of their customers for their own use and benefit.

In this country, the handling of cases of economic and financial crimes has been provided for under the Economic and Financial Crimes Commission (Establishment) Act 2002. The Economic and Financial Crimes Commission (EFCC) has the responsibility of implementing the provisions of the Act in order to give effect to the intendments of the law-maker in the interest of the generality of citizens, including bank customers. The enabling Act of EFCC in Section 5 sub-sections 1(b) and 1(e) specifically mandates the Commission to “investigate all financial crimes…” and to adopt “measures to eradicate the commission of economic and financial crimes”. In Section 12 sub-sections 1(a) and 1(b), the Commission is also expressly charged with ensuring the “prevention and detection of offences in violation of the provisions of this Act” and the “arrest and apprehension of economic and financial crime perpetrators”.

Thus far, from public knowledge, has the Commission carried out its above highlighted duties with regard to the on-going economic and financial crimes known as excess bank charges? Even, has there been any public statement from EFCC concerning the rising cases of these crimes in the banking industry? Why is the Commission keeping sealed lips about this illegality which the apex regulator in the banking industry, the CBN, has openly confirmed to account for the greatest number of bank customers’ complaints?

There may be many reasons to explain the failure or neglect of EFCC in attending to the issues of excess bank charges but the inescapable and most cogent one is that the Commission seems not to understand that excess bank charges are forms of economic and financial crimes. The second is that the Commission may not have appreciated that its mandate and powers cover the crimes of excess charges by banks. Third, the Commission may erroneously believe that the amount involved in the excesses is very small and therefore of little or no significance. Fourth, the human capacity of the Commission may be inadequate to enable it to focus some attention away from politicians to happenings in the banking industry. Finally, the Commission may have directly or indirectly been compromised to keep a blind eye and sealed lips.

Whatever the reasons or excuses for the EFCC to have done nothing about some banks’ practice of committing economic and financial crimes through imposition and collection of excess charges from their customers, the cry by bank customers and even other stakeholders for intervention to stop such practice is getting louder and deafening. This is justified by the rising incidence of the illegality, the huge amount involved and the gross negative implications. That nothing has been done and seen to have been done to seriously bring perpetrators of these acts to book, in line with the EFCC law, is a major contributor to the festering of the crimes in the hands of national wealth custodians who should be trusted. If bank customers can no longer trust their banks who will they and what promises await the economy?

The EFCC cannot continue to pretend that it does not know that it has a significant responsibility under its enabling law to protect the citizens, in this case, bank customers. It is, therefore, high time the Commission roused itself to confront these deadly corporate crimes as clearly specified in its enabling law. Hopefully, bank customers will soon be relieved of worries about excess charges.
Dr. Ogubunka, a financial and management consultant, is the President, Bank Customers Association of Nigeria (BCAN)