The Consumer Protection Council (CPC), has ordered the First Monument City Bank (FMCB) to refund to Borno State Government over N1bn on what the Council described as illegal deductions from the state’s account with the bank.
The statement by the CPC said after painstaking investigation, it found out that the bank carried out arbitrary and excessive charges on the said account.
The statement by the CPC reads in part: “Following the complaint to CPC by Bauchi, 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.
“Having reviewed the various responses, documents and presentations made by the parties at the investigative hearings, the Council said it found that the increase in the interest rate was not duly communicated to Bauchi government and that the interest rates applied across board by FCMB were excessive and arbitrary with some charges as high as over 50 per cent.
“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 BASG all excess interest charges and unlawful deductions in the total sum of N1,542,775,841.58 and at the prevailing interest rate.
“According to the Council, this order is 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.
“The government agency ordered FCMB to report compliance to the Order within 30 days of receipt. It 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.
“In addition, CPC also directed the bank to “present written assurances in line with Section 10 of the 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.”