Sunday March 24, 2024
Addis Ababa (HOL) — The Commercial Bank of Ethiopia, the nation's largest bank, is recovering substantial funds improperly withdrawn by customers due to a "systems glitch." This issue allowed individuals to extract cash exceeding their account balances early Saturday.
Local media reported that over $40 million was withdrawn or redirected to other financial institutions. The bank took several hours to halt all transactions in response to the incident.
The unauthorized withdrawals were predominantly executed by students, confirmed Abe Sano, the bank's president, in a press conference. The malfunction became widespread across academic institutions, primarily disseminated through messaging apps and direct communication.
Extended queues at campus ATMs were reported, and withdrawal incidents continued until law enforcement intervened. Notably, students from institutions such as Jimma University Institute of Technology and Dilla University participated in these unauthorized transactions during the early hours of Saturday.
Ethiopia's central bank stated that the bank, which was founded 82 years ago and serves over 38 million customers, experienced the glitch during routine maintenance. Although the central bank's statement highlighted the service disruption following the freeze of transactions, it did not address the funds withdrawn.
Despite the scale of withdrawals, Sano emphasized that the losses were minimal relative to the bank's overall assets. He assured customers that their personal accounts remained secure and the bank was not subject to a cyber-attack. Furthermore, he announced that students returning improperly acquired funds would face no criminal charges.
On Thursday afternoon, the bank announced on its social media page that it would be accepting digital payments in addition to in-person transactions at its branches.
“Although some individuals are appearing in the nearest branch of our bank to return the money they inappropriately took, in accordance with our call, until Saturday Megabit 14 [March 23], the importance of providing alternative ways of returning it is found essential… therefore in addition to returning at branches, you can return it using digital banking and directly return it to our account,” the statement said.
However, the effectiveness of the bank's efforts to reclaim the withdrawn funds remains to be determined. Reports from university campuses indicate mixed responses, with some students returning money voluntarily and others appearing hesitant.
Abe Sano issued a stern warning to those who benefited from the glitch, stating that legal action will ensue against customers who fail to return the funds by week's end. He contested the alleged $40 million figure, indicating that the actual amount will be established following an audit.
This ongoing situation underscores the bank's intent to enforce legal consequences for unreturned funds while highlighting the digital traceability of the transactions involved.