Grace Ashiru
The Commercial Bank of Ethiopia (CBE) reportedly recouped approximately $10 million from customers who withdrew excess funds from their bank accounts following a “systems glitch” on March 16, 2024.
Initially, reports suggested that the bank had incurred losses of up to $40 million. However, Abe Sano, the head of CBE, contested this figure, stating that the actual amount was lower and would be determined with precision. According to the BBC, the bank’s loss was $14 million. As a result, the recovery of $10 million represents a significant achievement, recouping three-quarters of the funds lost.
Per reports, university students withdrew most of the money after the news went viral via messaging apps and phone calls.
Following the widespread news of the glitch, there was a significant buildup of people at the campus ATMs. It was reported that approximately 490,000 transactions had been processed well before the bank was made aware of the issue. In response, three universities instructed their students to return any surplus cash withdrawn from the bank.
Sano issued a warning that individuals who refuse to comply will be subject to legal consequences, as the bank is presently notifying authorities about non-compliant customers. Despite this, a number of customers have willingly returned the funds.
He also emphasized, “There is no way for them to evade accountability as they are digital and our valued customers. We have a thorough understanding of their identities, making them traceable and legally responsible for their actions.”
The bank has not yet revealed the cause of the issue, but it has assured clients that their accounts are secure. The incident is being characterized as a system glitch rather than a cyberattack.
The Commercial Bank of Ethiopia (CBE) stands as the largest commercial bank in Ethiopia, overseeing more than 38 million accounts. Established 82 years ago, it currently commands nearly 67% of all deposits and 53% of all bank loans in the country as of mid-2021.
Several factors, including cyberattacks, contribute to financial losses for banks in Africa. For instance, in May 2023, I&M Bank Rwanda experienced fraudulent customer withdrawals amounting to $10.3 million, surpassing the $7.6 million loss incurred in December 2022. The fraudsters gained unauthorized access to the bank’s Swift system and illicitly transferred funds to accounts located outside Rwanda.
Absa Bank Kenya experienced a fraud loss of KSh 107.7 million ($716,566) in October 2023. However, the bank managed to recover KSh 59.1 million ($393,213) through the implementation of internal fraud risk-reduction measures.
