Shock in Nigeria’s financial sector as NIBSS loses N4 billion to System Glitch
The Nigeria Inter-Bank Settlement System PLC (NIBSS) is reeling from a massive system glitch that has left it vulnerable to unauthorized withdrawals amounting to a staggering sum of N4,190,101,636 (over N4 Billion). Online fitness
The company, which operates as the central mechanism for clearing and settling interbank transfers, has urgently approached a Federal High Court in Lagos, seeking judicial intervention to recover the stolen funds.
The colossal sum in question was illicitly siphoned from NIBSS due to an unforeseen flaw in its Instant Pay (NIP) engine, which allowed rogue transactions between 6th and 9th September 2024.
The system malfunction triggered a series of unauthorized fund transfers to 176 accounts held by 45 financial institutions, including some of the biggest names in the country’s banking sector.
In court documents, Patience Johnson, a litigation officer at Manfield Solicitors, swore an affidavit detailing the shocking turn of events.
According to Johnson, the glitch was first detected on Monday, 9th September 2024, as NIBSS was finalizing settlement for weekend transactions.
The unauthorized withdrawals covered a period from 6th to 9th September 2024, resulting in an immediate financial exposure of N13,662,138,920 (over N13.6 Billion).
Despite efforts to alert the involved banks and place restrictions on the accounts where the funds had been traced, the illicit funds were rapidly dissipated to new, unknown beneficiaries.
This led to a further staggering loss of N4,190,101,636. An additional N8,151,388,207.70 (over N8 Billion) was also moved to other accounts.
The NIBSS has sounded the alarm, warning that without urgent court intervention, the funds may be lost forever.
The company is now asking the court to issue an order mandating the respondents to place a Post No Debit (PND) restriction on all involved accounts to prevent further dissipation.
The Central Bank of Nigeria (CBN) has been notified of the breach, and NIBSS is invoking regulations that allow for account freezing to recover the funds. Online fitness
The company is hoping the court will act swiftly to prevent the complete loss of the money, which could have devastating consequences for the banking sector.
With Nigeria’s financial system already reeling from a series of security lapses, this incident raises serious concerns about the vulnerability of electronic funds transfer systems.
