WEMA Bank PLC has taken legal action against 26 financial institutions, seeking a court order to recover N888,301,598.15 allegedly withdrawn from its accounts without authorization due to a system glitch.
The bank, in a suit filed before the Federal High Court in Lagos, urged the court to issue a preservative order mandating the financial institutions to return the funds traced to accounts held within their institutions.
The legal move follows an operational failure in WEMA Bank’s core banking system on January 16, 2025, which resulted in the unauthorized transfer of a substantial amount of money from customers’ accounts.
According to an affidavit deposed by the bank’s Head of Special Review and Investigation, Kehinde Buari, the system malfunction led to unintended transactions affecting both accounts within WEMA Bank and those in the 26 defendant financial institutions.
Following the incident, the bank initiated an internal probe to trace and recover the missing funds. While a portion of the unauthorized transfers was located within its system, a significant amount was found in external accounts linked to the defendants.
Investigations revealed that some recipients of the funds attempted to move, hide, or obscure the origin of the money by transferring it across multiple accounts.
WEMA Bank swiftly alerted the affected financial institutions about the glitch and the fraudulent transactions, urging them to restrict and sequester the affected accounts.
The proactive response by some of the defendant banks led to the recovery of N888,301,598.15, which was frozen pending further legal directives.
As part of its ongoing efforts to retrieve the full amount, WEMA Bank’s internal audit and legal teams issued reports detailing the movement of funds, identifying recipient accounts, and outlining the sums recovered so far.
The bank also engaged the Nigeria Inter-Bank Settlement System (NIBSS) to track the funds across multiple financial institutions, prompting further correspondence with the defendant banks regarding the unauthorized transactions.
WEMA Bank is now seeking a court order compelling the 26 financial institutions to return the recovered funds and any additional sums that may still be traced.
The bank is also requesting that the court direct the institutions to disclose the details of account holders who received and dissipated the unauthorized funds, enabling law enforcement agencies to pursue further investigations and possible recovery.
Additionally, WEMA Bank has asked the court to mandate the placement of affected account holders on the Central Bank of Nigeria’s Credit Risk Management System and other financial watchlists through their Bank Verification Numbers (BVNs) until the full recovery of the lost funds.
The bank emphasized that while some of the affected financial institutions have taken preliminary steps to restrict the unauthorized transactions, a formal court order is necessary to ensure compliance and facilitate full restitution.
It maintained that failure to secure the required legal directives could result in the release of the frozen funds, thereby frustrating the recovery efforts.
