By Babajide Komolafe

Some years back, a fraudster hacked into the email account of a colleague. This was before whatsapp became a popular communication tool.

The fraudster infiltrated an email exchange trail, where the colleague had asked an acquaintance to pay N50,000 into an account. The fraudster sent a fake message asking the recipient not to pay into the account number indicated in the earlier exchange.

The fraudster then presented another account number which the payment should be made. Of course, the recipient, thinking the new message is from his friend, made the transfer into the new account.

This is an example of what is called Authorised Push Payment, APP fraud.
However, victims of such deception will soon have the opportunity to be reimbursed the money lost to the fraudsters.

In this regard, the Central Bank of Nigeria, CBN, in “Draft Guidelines For Handling Authorised Push Payment Fraud,” explained how the victims can get reimbursed and criteria for reimbursement.

According to the guidelines, APP fraud shall include, but is not limited to:
i. Inducement, coercion or misleading of a user/customer into authorising a payment via WhatsApp, SMS, E-mails and any other communication channel to a third party’s account or wallet.
ii. Facilitation, negligence, or non-compliance by financial institutions, such as failure to act on red flags, weak Know Your Customer, KYC, or fraud controls, staff collusion, delayed resolution, and use of accounts for fraudulent purposes.
According to the CBN, “A customer (victim of APP fraud) shall be considered eligible for reimbursement where:
i. The customer authorised the transaction under false pretence by another party and had no cause to suspect fraud;
ii. The customer reported the APP fraud within seventy-two hours (72) and cooperated with the investigation;
iii. There is no evidence of negligence, collusion, or criminal intent on the part of the customer; and
iv. The financial institution failed to implement appropriate fraud detection, warning, or verification protocols, that could have prevented the transaction.
The document further stated that: “Financial institutions shall not be obligated to reimburse in cases where:
i. The customer acted fraudulently or with negligence;
ii. The customer failed to or delayed reporting the fraud beyond seventy-two (72) hours of occurrence except for reasons highlighted in Section 7.0 (xii); and
iii. The transaction occurred prior to the effective date of this Guidelines, unless voluntarily applied retroactively.”

In summary, victims of APP fraud must report to their bank within 48 hours (two days) of the incident.

The victim must also have to prove that he was not negligent, and he did not in any way encourage and participate in the fraud.