First Bank of Nigeria (FBN), the country’s oldest financial institution, is embroiled in a legal battle after Abia businessman and community leader Eke Agbai Eke filed a lawsuit over an alleged disappearance of N550 million from his fixed deposit account.
The bank, however, has vehemently denied the allegations, calling them “entirely unfounded and false” in a statement by Managing Director Olusegun Alebiosu.
Key Details of the Fraud Case
1. Unauthorized Withdrawals: In December 2023, Eke discovered he could no longer access his account via FBN’s mobile app. Upon his arrival to Nigeria, he went to Abuja to withdraw his money which he was informed that he has no cash in the savings account.
An investigation revealed N55 million had been withdrawn in six transactions from his savings account at the bank’s former Abiriba branch (now relocated to Uzuakoli).
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Eke claims he never authorized the transactions. The bank paid him the N55 million.
This incident led to the closure of his fixed deposit account which he was informed he has no money in the fixed deposit account.
2. Community Impact: Eke deposited the funds to support FBN’s presence in his community, calling it a contribution to local development. The alleged fraud has sparked outrage, with critics labeling it a betrayal of trust.
3. FirstBank’s Response: In a corporate statement, MD Olusegun Alebiosu refuted the fraud claims, attributing the incident to “unprofessional and unethical dealings” between Eke and a former employee.
The bank alleges the transactions occurred outside its knowledge, facilitated by a personal relationship.
“Our findings indicate no involvement or awareness by the Bank. The matter is before the court, and we have reported it to law enforcement,”* the statement read.
FirstBank confirmed suspects linked to the case have provided statements, with investigations ongoing.
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Broader Implications For First Bank of Nigeria
The scandal amplifies concerns about FBN’s corporate governance and internal oversight, despite the bank’s insistence on operating with “the highest standards of integrity”:
1. Regulatory Scrutiny: The case follows the Central Bank of Nigeria’s (CBN) 2023 N2.8 billion fine against FBN for Anti-Money Laundering (AML) violations. Experts warn of potential penalties if negligence is proven.
2. Reputational Risks: As Nigeria’s oldest bank, FBN faces reputational damage, particularly in rural communities like Abiriba, where grassroots trust is critical.
3. Systemic Insider Threats: The bank’s dismissal of employees and allegations of external collusion echo past scandals, including the 2021 CBN intervention over unauthorized leadership changes and 2024 insider loan claims.
Why This Case Matters For Nigeria’s Banking Sector
Customer Protection Gaps: Delays in resolving Eke’s complaint highlight weak grievance-redress mechanisms.
Digital Security Concerns: Questions linger about vulnerabilities in FBN’s mobile app and fixed deposit protocols.
Legal Precedent: A court ruling could redefine accountability standards for Nigerian banks.
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FirstBank’s Official Statement
In response to media reports by Thisday Newspaper and Arise Television, FirstBank stated:
Denial of Fraud: “Allegations of fraud are entirely false. The issue stems from unethical conduct between the customer and a former employee.”
Ongoing Investigations: Law enforcement is probing the matter, with suspects already cooperating.
Commitment to Integrity: The bank reaffirmed its dedication to “transparency, accountability, and customer protection.”
First Bank of Nigeria’s History of Scandals
FBN’s recurring governance lapses have drawn regulatory ire:
2021 Leadership Crisis: CBN dissolved FBN’s board over unauthorized CEO changes.
2023 AML Fines: Sanctions for poor due diligence and transaction monitoring.
2024 Insider Loans: Allegations of unethical lending to connected parties.
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What’s Next?
The lawsuit’s outcome and law enforcement findings could reshape accountability in Nigeria’s financial sector. Stakeholders urge the CBN to enforce stricter oversight and customer protection laws.