SO grave, so disturbing, so unstoppable has Automatic Teller Machine (ATM) fraud become that banks’ obvious helplessness continues to fuel panic among customers.
Reports in the last few months have shown an upsurge in the number of people who have fallen victims of ATM fraud in Nigeria. But as strange as some of these cases may appear, the overt cluelessness displayed by most of the banks whose staff are seen by many as prime suspects in this development is more confounding.
One of the recent victims of ATM scam is Mrs. Ogundiran Adebisi, who received three debit alerts via ATM withdrawals while her ATM card was right with her at home. Mrs. Ogundiran’s ordeal began on Wednesday, May 4, 2016 when she went to Sango-Ota branch of Skye Bank to get a new ATM card following the expiration of her former card.
“My former ATM card expired in March this year and I went to he Sango Ota branch of Skye Bank Plc on Wednesday, May 4, 2016 for a new one. But unlike what I knew to be the practice where customers with new ATM cards were issued with new Personal Identification Number (PIN) in sealed envelopes, the bank’s staff who attended to me informed me that the One Time Password would be sent to my phone. And just as I was told, I received the password at 5:36 pm the same day after which I followed the activation procedures I was given,” she disclosed.
But Ogundiran received the shock of her life barely 24 hours after getting the new ATM card. “On Thursday, May 5, 2016 I received an SMS alert of N20, 000. The details of the transaction showed that the withdrawal was made at Imo Polytechnic. I was alarmed and the people who were around me insinuated someone who knew my PIN number may have made away with my card but they were shocked when I brought the card out of my bag and showed them. The card was still in my hand when I received two more debit alerts indicating that additional N40,000 had been withdrawn from my accounts. That’s how I lost N60,000,” she said.
The manner of Ogundiran’s loss differs slightly from Mr. Segun Olufemi’s experience. On Sunday, February 28, 2016, Mr. Olufemi handed over his Guaranty Trust Bank’s ATM card to his wife to help get some cash on her way from church. Shortly after church service, Mrs. Olufemi decided to use the ATM at Abule Egba branch of Stanbic IBTC Bank Plc., located at U-Turn Bus-Stop along the Lagos-Abeokuta Expressway. She joined the queue and few minutes later it was her turn to use the machine.
“Since it wasn’t possible to withdraw N65,000 at once,” Mrs. Olufemi began, “I decided to withdraw the money three times. Unfortunately my card got trapped as I attempted to make the second withdrawal, perhaps owing to network problem because I observed that the machine went blank.
“After waiting for some minutes, one of the customers behind me called the attention of the security man on duty to my plight. The man came and assured me that the card would still come out. I remained at the spot for over 20 minutes until every other customer who had wanted to use the machine left. During this period, the security man kept assuring me that the card would still come out.
“While I was waiting, my husband who had received an online debit alert for the first withdrawal I made called to ask what the problem was. I explained to him and he advised I waited as the security man had told me. But after waiting for about 45 minutes, the security man advised me to go and report to the bank the following day, which was a Monday,” she said.
The Olufemis nursed no fear of anything untoward until they were told by a staff of the bank that their card was not among the cards recovered from the ATM that morning. At this point, Mr. Olufemi intuitively went online to check his account balance. Alas! He could only communicate what he saw with a scream. His account had been drained. According to the details of the transaction, the money was withdrawn midnight of the day at a GTB branch in Iju.
Curiously, however, while the Iju branch of GTB where the money was withdrawn was able to play the CCTV footage of the transaction, the couple told Sunday Sun that the Abule Egba branch of Stanbic IBTC, where the ATM card was reported to have been trapped refused to show them the footage of their CCTV recordings for the day.
The Olufemis and Mrs. Ogundiran are just two among thousands of Nigerians who recently lost their money to ATM fraud. These victims are not only united by pains of the losses they suffered, their ordeals in getting refund from the banks are also similar. The Olufemis lost their money on Sunday, February 28 and reported the case 24 hours later. But almost four months after, the couple is yet to get their money. A similar scenario is equally playing out in the case of Mrs. Ogundiran more than one month after she lodged her complaint at the Sango Ota branch of Skye Bank where she got the ATM on Wednesday, May 4, 2016.
According to a forensic Accountant, Mr. Ori Adeyemo, while victims of fraudulent transactions are expected to lodge their complaints as soon as fraudulent transactions are discovered, the bank has the burden of absolving itself of complicity in the fraud, failure of which the bank will be duty-bound to refund the victim. “A victim of fraud transaction may also write the Central Bank of Nigeria, CBN. But I can assure you that you will be wasting your time with CBN because CBN also colludes with these banks. But in case you don’t get your money, you may get your lawyer to write the bank. But if the bank still refuses to pay, you may approach the court. Although going to court may be slow, you are certain of getting justice,” he said.
Speaking on the case of Mrs. Ogundiran who received debit alerts which indicated that the withdrawals were made through ATM in Imo State while she was in Ifo with her card, the forensic Accountant said, “It is very possible. It is a usual fraud some unscrupulous elements in banks do.
There was an instance when someone received debit alerts right in the presence of a banker in the banking hall with his ATM card right there with him. When it happens like that you don’t need to look far off because the perpetrators are right in the bank. Those in the banks have the code; they are the ones who give out the ATM cards. They may have cloned the cards,” he said.
But bank frauds perpetrated via the ATM may be more complex and may have gone far beyond the cloning of ATM cards as noted by Mr. Michael Wona, a computer scientist. According to him, criminals may attach devices to ATM machines to record the account data stored on the magnetic stripe on the back of the card. This practice, according to him, is known as skimming. “The card’s PIN can be spied with a secret camera or a fake number pad overlay.
“ Unfortunately, the victim of such scam may have to bear the brunt because it is always difficult to prove to the banks that you are not liable. Most banks would like you to believe they always refund stolen money. But the reality is that a bank can easily deny a refund based on flimsy reasoning that leaves consumers with little recourse other than going to court. The banks will deny that their systems suffer from any weaknesses and place the blame squarely on the customer,” he pointed out.
True to this position, Mrs. Olufemi and Mrs. Ogundiran have had difficulties in getting their money from the banks as the banks consistently push the blame on the two customers who on the other hand are accusing the banks of complicity over their losses.
When called for inquiry on the case, the Sango-Ota branch Head of Customer Service, Mr. Oladotun absolved the bank of any blame. However, when Sunday Sun called line dedicated to customers’ complaints at the Abule Egba branch of Stanbic IBTC, the receiver declined comment on the matter on the grounds that the Sunday Sun correspondent who called was not the affected customer.
But while the Sango Ota branch of Skye Bank insists that their system is infallible, Mr. Wona maintained that it was possible some ATMs process transactions even if a card doesn’t have the chip and, therefore, allow fraudsters to withdraw funds using cloned cards.
“In advanced countries, victims of this kind of fraud can sometime prove to their banks that they didn’t do a transaction because cash cards contain what is known as an Application Transaction Counter (ATC), which records the number of times a card has been used. An ATC with one less transaction than was performed would presumably be evidence that a bank’s customer wasn’t lying about withdrawing money. Fixing the problem will require banks to upgrade all their ATMs, which takes time,” he posited.
Speaking specifically on Mr. Olufemi’s case, Mr. Wona said the Abule Egba branch of Stanbic IBTC Plc where the couple’s ATM card got trapped owes the couple the responsibility of making the CCTV footage of the transaction available to them to be able to clarify what went wrong.
“It is very wrong for the bank to deny them the opportunity of seeing the footage except the bank has something to hide. If it was a case of faulty machine, they should be able to own up and accept responsibility for the loss and if it was a case of negligence on the part of the woman who used the card on their ATM, the CCTV should be able to reveal that,” he said.
Meanwhile the, Acting Director, Corporate Communication Central Bank of Nigeria, Mr. Isaac Okorafor, in a telephone chat with Sunday Sun, urged victims of the fraudulent transactions to lodge their complaints with the affected bank immediately and wait for two weeks for the bank’s response.
“Should the bank fail to take any action after two weeks, the customer can write to the Consumer Protection Department of the Central Bank of Nigeria,” he advised.