Earlier this year, in March, TAJ Bank Ltd. experienced yet another system failure that resulted in the unapproved transfer of an astounding N957.4 million to multiple accounts across 26 banks and fintech platforms. The bank experienced a similar system error that removed N139.6 million from its system almost a year before this.
In an unexpected turn of events, though, the bank has dropped its appeal to the Federal High Court in Abuja to have the unauthorised debits reversed. Remember that the court had previously denied TAJ Bank’s request for a post-no-debit and interim freezing against the 26 financial institutions.
According to court documents, TAJ Bank, which ultimately dropped its lawsuit on July 21, 2025, claimed that the identified institutions had the authority to block, freeze, and return to it the N957,394,438.94 that was linked to customer accounts under the Central Bank of Nigeria’s Regulatory Framework for Banking Verification (BVN) Operations and Watchlist for the Nigerian Banking Industry (2017).
As a result of a system error on the Plaintiff’s server, the bank stated that the funds were unlawfully taken out and “transferred from the accounts of the Plaintiff to the accounts of the customers of the 1-26 Defendants respectively following the system glitch in the Plaintiff’s server.”
According to the bank’s lawsuit, which was filed on June 11, 2025 and was designated FHC/ABJ/CS/1132/2025, TAJ Bank went to court, claiming that the system error had a significant negative impact on the plaintiff. It accused the 26 financial institutions’ clients of exploiting the glitch to steal its clients’ money. In addition, the bank claimed it would suffer “untold hardship and dire financial loss” if its applications for post-no-debit, freezing, and reversal were denied.
TAJ Bank’s legal team stressed that the Central Bank of Nigeria (CBN) Establishment Act is in charge of guaranteeing the security of client funds and provides regulatory oversight over financial institutions in Nigeria.
The bank had this to say: “An order of this Honourable Court directing the 1st–26th Defendants to comply with the Central Bank Guidelines Nos. BPS/DIR/GEN/CIR/02/004 of 2015, BPS/DIR/GEN/CIR/05/011 of 2018 and the Central Bank of Nigeria’s Regulatory Framework for Banking Verification (BVN) Operations and Watchlist for the Nigerian Banking Industry, October 2017 by blocking or placing ‘No Debit’ restriction on the sum/monies to the extent of the sums illegally received into the respective bank accounts of the 1st–26th Defendants’ customers’ accounts following a system glitch from the Plaintiff’s server on the 9th and 10th day of March, 2025 as listed in the documents marked as EXHIBITS TAJ D1-D8 pending the complete/full refund/reversal.”
Continuing, TAJ Bank maintained that when abuse or fraud is suspected or reported, it is the responsibility of the appropriate authorities and stakeholders to safeguard the banking and payment service sector against misuse by “dishonest users” and to take appropriate action to stop damages.
Rilwanu Idris, Esq., the attorney for TAJ Bank, testified before Justice Muhammad Umar on June 27, 2025, and made his motion ex parte against the designated financial institutions known to him.
According to his argument, the financial institutions allegedly had N957 million that had been taken from his client due to the glitch. Adding that a court order was required to hold the money until the suit was resolved to track down and freeze it. TAJ Bank would take steps to guarantee that no one’s interests were jeopardised, he promised the court.
He went on to say: “The money had already been deducted, all the respondents concerned are in business, and if you ask them to produce this money, they will.”
He emphasised that if the court didn’t step in, “the money will go.”
Ruling on TAJ Bank’s motion for an interim freezing order, Justice Umar held that: “The ex parte application(by TAJ Bank) is refused.”
Instead, he ordered that TAJ Bank’s procedures be adjusted to put the financial institutions on notice. The hearing was then postponed until July 21, 2025.
But when the hearing resumed, T. O. Nworie, the bank’s attorney, told the judge that the bank had decided to end the case. Nworie revealed: “We want to bring to the notice of this Court that in line with the Rules of this Court, we filed a Notice of Discontinuance, and we want the Court to take notice of that. It was filed on 17th July, 2025.”
Futhering, in open court, no additional information regarding the withdrawal decision was provided. The Notice of Discontinuance dated July 17, 2025, was granted by Justice Umar, invalidating TAJ Bank’s lawsuit against the financial institutions.
The incident in 2024
According to a previous August 2024 Nairametrics report, Justice Peter Lifu of the Federal High Court in Abuja issued an interim freezing order against a number of accounts at Fair Money Microfinance Bank Ltd. and other institutions.
Due to a “system glitch” at TAJ Bank Ltd., the order required the organisations to reverse N139,630,000 that had been credited to certain customers and account holders. The bank’s legal team clarified that more money belonging to TAJ Bank’s clients would be lost if all of the accounts (belonging to suspected fraudsters) in its exhibits were not immediately blocked or put on no-debit restriction and the illegally obtained amounts were not reversed.
BrandSpur banking and finance news desk reports that TAJ Bank’s request for an interim order was granted by Justice Lifu, who also mandated that TAJ Bank take steps to safeguard or insure the fintech platforms in question against any losses if new information made the interim orders unsuitable.
