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CBN: Court order mandatory for accessing BVN information



CBN: Court order mandatory for accessing BVN information


The Central Bank of Nigeria (CBN) has announced that the provision of a valid court order is now one of the conditions that must be met by applicants seeking access to the Bank Verification Number (BVN) details of any bank customer.


The apex bank stated this in a circular to Deposit Money Banks (DMBs), Switches, Mobile Money Operators, Payment Solution Service Providers, Micro-Finance Banks and other operators posted on its website yesterday,


The circular entitled: “Amendment to the regulatory framework for Bank Verification Number operations and watch-list for the Nigerian banking industry,” was signed by the CBN’s Director, Banking and Payments System Department, Mr. Dipo Fatokun.


According to the circular: “Section 1.6 of the Framework: Eligibility for Access to the BVN, which states that, ‘The following entities may have access to BVN information, subject to the approval of the CBN’, is hereby amended to read thus: ‘The following entities may have access to BVN information, after providing a valid court order, subject to the approval of the CBN.”


It would be recalled that under the regulatory framework for BVN and Watch-list operations unveiled by the CBN on October 18 last year, the Apex Bank had stated that entities that may have access to BVN information, subject to its approval include: “DMBs, Other Financial Institutions (OFIs), Mobile Money Operators, Payment Service Providers, Law enforcement agencies, Credit Bureaus and other entities as applicable.”


The Banking watchdog had explained that the framework, which defined the establishment and operations of a Watch-list for the banking industry was aimed at addressing the increasing incidences of frauds in the industry.


Specifically, it stated that the Watch-list comprises a database of bank customers’ identified by their BVNs, who have been involved in confirmed fraudulent activities in the Nigerian banking industry.


The CBN had stated then that: “A watch-listed individual shall not be allowed to enter into new relationship with any bank; a bank may choose not to continue business relationship with account holder on the watch-list. Where a bank chooses to continue an existing business relationship with holders of account on the watch-list, the account holder shall be prohibited from all e-channels, such as ATM, POS, Internet Banking, Mobile Banking, including issuance of third-party cheques.”


Besides, it said: “A watch-listed customer shall not provide reference to another customer, neither shall he/she be allowed access to credit facility or guarantee credit facilities. A watch-listed individual shall remain in the watch-list for a period as specified in the penalty table. In the event of a reoccurrence, the tenure shall begin to count from year one.


“Penalties that applied to watch-listed customers shall apply to all accounts that he or she is a signatory to.”


The regulator warned that it would penalise any lender that fails to put individuals confirmed to have been involved in fraudulent activity on the watchlist.

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