Bank of Namibia to ensure full refund for Standard Bank clients affected by international fraud

The Bank of Namibia (BoN) says it will ensure that all clients of Standard Bank Namibia (SBN) who lost money over the weekend will be refunded.

This comes after it was revealed yesterday that several clients of the bank lost money due to international financial fraud.
“The bank (BoN) continues to engage the relevant banking institution to ensure all impacted customers are reimbursed in accordance with the relevant internal policies and processes, and that their systems remain resilient,” central bank spokesperson Kazembire Zemburuka said yesterday.

He said to fulfil its regulatory mandate, the central bank requires banks and authorised payment service providers to adhere to specific regulations which ensure operational and cybersecurity resilience in the National Payment System.

This system sets principles for maintaining information security controls, and provides guidelines for ensuring the system’s efficiency.

“The existing regulatory frameworks provide for a range of requirements that need to be fulfilled to mitigate against cyber risks within the banking ecosystem.

“As digital transformation continues to shape the National Payment System, the bank consistently researches and updates its regulatory frameworks to address and mitigate emerging risks effectively,” Zemburuka said.

Meanwhile, SBN said it has put in place corrective measures after some of its account holders recorded unauthorised payments by an international company on Sunday night.

Some of the clients had thousands of dollars transferred from their accounts and their bank balances left with negative balances.

SBN spokesperson Magreth Mengo said the payments were made by an international company using clients’ debit card details, but no account was hacked.

“Please note, there was no unauthorised access to clients’ bank accounts. This was a limited number of unauthorised debit card transactions from an international merchant,” she said.

“It is a limited number of clients which represents a minute percentage of the Standard Bank client base,” Mengo said.

She said the affected clients have been contacted and corrective measures have been put in place.

“Impacted clients have been contacted and corrective measures have been taken. We will continue monitoring the situation,” she said.

A message sent from the bank to an affected client indicates that the bank will refund clients within 24 hours.

“We would like to assure our stakeholders that our systems remain resilient,” Mengo said.

Namibians on social media, reacting to the news, said it is becoming common for bank clients to have money deducted from their accounts without their authorisation.

Some say it takes 14 days and a lot of paperwork to get a refund.

Other social media users say people should avoid paying by card in public places like clubs, bars and restaurants to avoid being hacked.

Banks should have proper consumer protection measures in place, they say.

“That is dangerous. Banks must make sure to protect clients’ money, please. This could cause serious problems for individuals and the economy,” PK Shikongo wrote on Facebook.

An X user claims he has been scammed several times using Standard Bank’s mobile money transfer service.

“Standard Bank has a weak security system. I got scammed out of N$5 000 once by a message from SBalert,” @franlinsaint wrote.

Another user, @NamibiaInvest, posted: “Unacceptable. Outdated technology and security measures in place. Hackers target vulnerable systems and it only becomes apparent after customers complain.”

The Bankers Association of Namibia yesterday directed questions on consumer protection back to SBN.

“I would suggest we exercise caution with generalisations. I am not aware of what is happening at SBN.

“I suggest you speak to them directly. I have no mandate to speak on behalf of SBN on this particular issue,” the association’s chief executive, Brian Katjaerua, said.

Banking insiders say cybercrime affects all banks on a daily basis.

In January, former minister of information and communication technology Peya Mushelenga said Namibia was exposed to 2.7 million cyberattacks where information was hacked in 2022.

During a staff meeting held at the parliament building on Friday, Mushelenga disclosed that the country experienced an average of 7 000 attacks per day in the same year.

During the first half of 2022, Namibians committed bank fraud to the value of N$18.6 million.

The majority of fraud incidents occurred through electronic fund transfers to the value of N$10.57 million.

*This story has been updated*