Lotus Bank Sues 45 Banks to Recover ₦1.13bn Lost in System Glitch, Case Adjourned to December
A Federal High Court sitting in Ikoyi, Lagos, presided over by Justice Daniel Osiagor, has been invited to adjudicate on a suit filed by Lotus Bank Limited seeking to recover the sum of ₦1,133,808,604.31 allegedly lost to fraudulent withdrawals by hundreds of its customers following a system failure on its electronic payment platform in July 2024.
In its motion on notice, the bank alleged that 718 customers took advantage of a “system glitch” on 20 July 2024, which arose from a rollback fix on its E‑Bills Pay platform that temporarily disabled automatic debit processes. During this period, the affected customers allegedly withdrew and transferred funds far in excess of their available balances, fully aware that their accounts could not sustain the transactions.
To recover the funds, Lotus Bank joined 45 commercial banks as defendants, contending that they hold the proceeds of the disputed transactions. The suit was filed pursuant to Order 3 Rules 1, 6 and 9 of the Federal High Court (Civil Procedure) Rules 2019 and under the court’s inherent jurisdiction.
The bank posed three key questions for determination:
1. Whether, under the CBN Guidelines No. BPS/FIRGEN/CIR/02/004 of 2015 and BPS/FIRGEN/CIR/05/011 of 2018, particularly Sections 10.2.2 – 10.4, the 1st to 45th defendants are not obligated to place a lien on the sums standing to the credit of their customers listed in Exhibit 1.
2. Whether Lotus Bank is not entitled to a refund of all funds illegally transferred into the defendants’ customers’ accounts where such funds remain available.
3. Whether, where the funds are insufficient, the defendants are not mandated to place a lien on any remaining sums domiciled in their institutions until full restitution is made.
Based on these questions, Lotus Bank seeks:
– A declaration that the defendants have a duty to safeguard the banking and payment system from abuse and to take reasonable steps to prevent systemic damage when fraud is reported.
– A declaration that the plaintiff is entitled to a refund of all funds illegally transferred into the defendants’ customers’ accounts where such funds are still available.
– An order directing the defendants to reverse and remit to the plaintiff the aggregate sum of ₦1.133 billion, or any sums subsequently recovered, until the full amount is repaid.
– Such further orders as the court may deem fit in the circumstances.
The motion is supported by a 19‑paragraph affidavit deposed to by Gbenga Ojerinde, a Fraud Investigation Officer with the bank, together with a written address and documentary exhibits.
In its affidavit, Lotus Bank averred that:
– The glitch enabled customers to initiate transfers to other banks without corresponding debits to their accounts.
– The total exposure amounts to ₦1.133 billion, as detailed in Exhibit 1.
– The incident was duly reported to the Nigeria Inter‑Bank Settlement System Plc (NIBSS).
– The beneficiaries retained the funds and failed to reverse them despite knowing they were not entitled to the credit.
Some of the defendant banks have already filed responses. The matter has been adjourned to December 2025 for further hearing.
