The Commercial Bank of Ethiopia (CBE) is reported to have successfully recovered approximately $10 million from customers who withdrew excessive amounts of money from their accounts due to a system malfunction that occurred on March 16, 2024.
Though initial reports suggested a loss of up to $40 million, CBE’s head, Abe Sano, contested this figure, stating that the actual sum withdrawn was less and would be accurately determined. According to a BBC report, the bank’s loss was roughly estimated to be $14 million. Consequently, the recovery of $10 million signifies that approximately three-quarters of the diverted funds have been recouped.
University students were reported to have withdrawn most of the money. This action was encouraged by the news of the glitch, which swiftly spread via messaging apps and phone calls, leading to long queues at campus ATMs.
Approximately 490,000 transactions were carried out hours before the bank became aware of the glitch. In reaction, three universities urged their students to refund any excess money they may have withdrawn from the bank.
Abe Sano has warned that individuals who fail to comply with the refund may face legal consequences, as the bank is presently involving law enforcement in the matter. However, several customers have voluntarily refunded the excess funds they withdrew.
Sano reassured customers of their traceability and accountability, stating, “There is no way that they can escape because they are digital, and they are our customers. We know them. They are traceable, and they are legally accountable for what they did.”
Although the exact cause of the malfunction has not been revealed, the bank has assured its clients of the security of their accounts. The issue has been identified as a system glitch rather than a cyberattack, reinforcing the bank’s intent to protect customer information.
The Commercial Bank of Ethiopia (CBE), with over 38 million managed accounts, stands as Ethiopia’s most substantial commercial bank. Founded 82 years ago, as of mid-2021, CBE was the holder of almost 67% of all deposits and 53% of all bank loans across the nation.
However, numerous factors lead to financial losses for banks in Africa, cyberattacks being one of them. In May 2023, a case was reported at I&M Bank Rwanda where illicit customer withdrawals led to a loss of $10.3 million. This significant loss was triggered by fraudsters infiltrating the bank’s Swift system and directing funds to offshore bank accounts, and it surpassed the bank’s December 2022 loss of $7.6 million.
Similarly, Absa Bank Kenya reported a fraud loss of KSh 107.7 million ($716,566) in October 2023. However, through internal fraud-limiting measures, the bank was able to recover KSh 59.1 million ($393,213).
