Lagos - The Central Bank of Nigeria (CBN) said it would collaborate with commercial banks and law enforcement agencies to investigate and prosecute errant bank customers who issued dud cheques.
The announcement follows the growing incidences the use of dud cheques within the banking sector. A dud cheque is cheque that cannot be paid because the person who wrote it has no money or not enough money in their bank account.
CBN said that the country processed dud cheques worth N166 billion ($25billion) in 2012.
According to the CBN, the value showed that the “enormous volume of dishonoured cheques in the financial sector has shown no sign of abating.”
Subsequently, CBN has issued a circular to banks outlining plans to curb the problem.
CBN said the implication of the development was the low confidence generated in the use of financial instruments that was adversely affecting its ‘Cash-Lite’ policy aimed at reducing the volume of cash-based transactions in the country.
“It is on this note that the bank, in liaison with financial institutions and law enforcement agencies, has taken steps to stem the tide of dud cheques as it can adversely affect the stability of the financial system," CBN stated in the circular.
“Customers of financial institutions should be informed that the CBN will forward the account details of errant customers to the Economic and Financial Crimes Commission for investigation and possible prosecution.”
Under the Dishonoured/Dud Cheques Act of 1977, the law stipulates a two-year jail term upon conviction for dud cheque issuers but has rarely been enforced in the country.
- CAJ News