FCMBThe Consumer Protection Council (CPC) has ordered First City Monument Bank (FCMB) to refund the sum of N1, 542,775,841.58 to the Bauchi State Government (BASG) at the prevailing interest rate.

The Council’s Director-General, Mrs. Dupe Atoki, yesterday stated that the order was in line with its functions to provide redress for unscrupulous exploitation of consumers by companies, firms, trade associations or individuals, under Section 2 (i) of the Consumer Protection Council Act, Cap. C25 of the laws of the Federation of Nigeria, 2004.

Atoki assured that the Council will continue to fight for the rights of aggrieved consumers in any sector of the country’s economy.

The Director-General constituted a panel of experts, including those from the office of the Accountant-General of the Federation, which deliberated extensively on the matter, and provided the parties repeated opportunities to make representations.

She, therefore, charged Nigerian banks to realise that their customers, either corporate or individual, symbolised the essence of their existence, and should exhibit high level of professionalism and ethical practice in their interaction with the customers.

Giving an update on the issue, Atoki said Bauchi State government sent the petition to the council after the Central Bank of Nigeria, CBN, declined further adjudication on the case through a letter dated July 15, 2015, to the petitioner, asking it to “seek alternative means of redress as the case is, hereby, deemed closed.”

The Bauchi State government in its petition to CPC, alleged that FCMB had short-changed the government with N1,864,188,594.78 excess interest and other charges on its loan account with the bank.

“FCMB, which was then known as First Inland Bank Limited, granted BASG two-term loans of N10 billion and N3 billion in 2009 and 2011 respectively at 13 per cent floating interest rate as claimed by the state government, while FCMB said it was increased to 21 per cent, raising dispute as to whether or not the increase in interest rate was duly communicated to BASG,” the council said.

The council also ordered FCMB to report compliance to the order within 30 days of receipt, and also ordered the bank to develop and present to it a Customer Complaint Resolution Policy within 30 days of the receipt of the order and post same on its website.

“Having reviewed the various responses, documents and presentations made by the parties at the investigative hearings, the council disclosed that it found out that the increase in the interest rate was not duly communicated to BASG and that the interest rates applied across board by FCMB were excessive and arbitrary, with some charges as high as over 50 percent,” the council added.

The council also found that apart from the arbitrary and excessive interest charges, the substantial part of the unlawful deductions was made from the principal loan repayment.

Also identified as part of the illegal deductions by CPC’s investigation was the excess processing fees and even management fee which was not provided for in the offer letters.

The council, therefore, ordered FCMB to refund to Bauchi State government all excess interest charges and unlawful deductions in the total sum of N1,542,775,841.58.

CPC also directed the bank to “present written assurances in line with Section 10 of Consumer Protection Council Act that they will refrain from a continuation of any conduct, which is detrimental to the interest of consumers of banking services.”



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