www.ngrguardiannews.com/index.php?option=com_content&view=article&id=38049:cbn-goes-tough-on-banks-over-atm-fraud-others&catid=1:national&Itemid=559

Orders resolution of dispute in 14 days

PIQUED by banks’ non-compliance with
guidelines on the operations of Automated
Teller Machines (ATM) in the country, the
Central Bank of Nigeria (CBN) yesterday
threatened to penalise financial institutions
with unresolved ATM-related cases.

In a circular on its website signed by the
Director of Banking and Payments System
Department, A. Atoloye, the CBN said that its
circulars and guidelines on ATM operations
in the country had been disregarded with
impunity.

According to the bank, it has become
necessary to bring order into the market by
stipulating some penalties for non-
compliance with the CBN directives and
policies on ATM operations.

Against the backdrop of recurrent ATM-
related fraud cases, the CBN said that a bank
that failed to respond to a customer or the
apex bank on ATM complaints within 72
hours would attract a fine of N50,000 per
day.

The CBN stated that a deployer of an ATM
would refund the total amount involved in a
fraud if there was no evidence of a
resolution of the dispute within 14 days.
The CBN’s circular noted: “For non-
compliance with Payment Card Industry
Data Security Standards (PCIDSS) a fine of
N50,000 per week will apply until
compliance is established; non-compliance
of ATM terminals with EMV levels 1 & 2, will
attract a fine of N50,000 and temporary
suspension of the affected terminal until
compliance is established; non-compliance
with migration to EMV after September 30,
2010, will attract a fine of N50,000 and the
issuer will bear full liability for any fraud
perpetrated with the mag-stripe card;
failure to provide audit trails and journals
for ATM transactions will attract a fine of
N50,000 per week.

“ Others are, failure to have two per cent of
ATMs deployed with tactile graphic symbol
for the use of visually impaired customers
within the five-year time line will attract a
fine of N50,000 per week; failure to comply
with new policy of offsite ATM deployment
will attract a fine of N50,000 per week until
compliance is established; failure to
establish help desk contacts will attract a
fine of N50,000 for each day of infraction;
non-functional help desk contacts will
attract a fine of N50,000 for each day of
infraction; failure to disclose ATM surcharge
to customers, a refund of the surcharge to
the affected customers will be enforced by
the CBN; for lack of online monitoring
mechanism and back-up power (inverter)
for ATM, a fine of N50,000 per day, will
apply.

“… ATM without a camera installed will
attract a fine of N50,000 and deactivation
of the ATM until the camera is installed; a
fine of N50,000 per day will be applied for
late submission of returns/data on ATM
frauds when required; an ATM deployer will
be made to refund the full amount involved
in any fraud perpetrated on its ATM for
failure to provide footages on the disputed
transactions when required; failure to
respond to the customer or to the CBN on
ATM complaints with 72 hours will attract a
fine of N50,000 per day for each complaint
after the 72 hours until the response is
received and failure to resolve any ATM
dispute with evidence of resolution within
14 days, the deployer will refund the total
amount involved in the fraud. ”

Other non-monetary sanctions that could be
applied to the erring institutions include
naming “the offenders at the Bankers’
Committee forum; suspension of offenders
from participation in clearing operations
until the infraction is corrected; and
suspension of offenders from participation
in RTGS operations until the infraction is
corrected. ”