Regulatory Alerts2013-07-09 | FPR/DIR/CIR/GEN/03/005Circular to Banks and Other Financial Institutions on Dud/Dishonored Cheques
The Central Bank of Nigeria (CBN) has expressed concern over the rising number of dud and dishonored cheques, totaling over N166 billion from January 2012 to December 2012. This trend threatens consumer confidence in financial instruments and adversely impacts CBN's "Cash-Lite" policy. To address this issue, the CBN requires banks and other financial institutions to ensure that customers promise not to issue cheques against unfunded accounts. Banks must monitor cheque transactions and report any customer issuing three such cheques on a monthly basis to CBN. In addition, erring customers' account details will be forwarded to the Economic and Financial Crimes Commission for further investigation and prosecution. This measure is intended to stabilize Nigeria's financial system and prevent money laundering.