Introduction

For a long time now, the Nigeria Police has been adopting a certain procedure in its bid to assist a complainant who alleges that (s)he is a victim of fraud. So, upon receipt of such complaint, the Police will prepare an application called Bankers’ Order and proceed straight to the nearest Magistrates’ Court to obtain the endorsement of a Magistrate.

The Bankers’ Order is in the nature of a Form, an already made Form containing standard provisions. The Form itself is like a one-page motion paper through which an application is made to the Magistrate by the Police seeking the freezing of the account of a particular bank customer. In worst cases, the Police will also seek for an order that a particular bank transaction by way of transfer or deposit made by Mr. A to Mr. B be immediately reversed to Mr. A. The Magistrates are ever ready to cooperate with the Police in granting such application which usually takes only a couple of hours. Upon granting same, the Police will immediately head to the bank and serve the bank with the Order. The bank will usually move to comply.

The Mischief

Although the use of the Bankers Order presents a faster means of stopping fraud, however, here is the mischief: A fraudulent individual like Mr. A may take advantage of the Bankers’ Order by fraudulently activating the Police to assist him in securing a reversal of the payment made to Mr. B which ordinarily was a legitimate payment to which Mr. B was certainly entitled to, usually on the basis of a particular contract for which Mr. A had taken benefit. This means that the moment the transfer or payment to Mr. B is reversed by the bank, Mr. B will automatically run at a loss. In many cases, Mr. A would have disappeared into thin air.

As soon as Mr. B approaches the bank to complain, the bank will alert the Police and Mr. B will be arrested and detained. Upon securing his bail after paying the usual ‘ransom’ to the Police as ‘tradition’ demands, Mr. B will sue the bank (and sometimes the Police) making claims. The bank will quickly rely on the fact that they merely obeyed a court order, nothing more. The Police may not defend the action and any money judgment obtained will become a herculean task to execute. The number of persons who have been victims are incredibly high.

What the Law says

The use of the Bankers’ Order is to be employed ordinarily in a legal proceeding. Section 7 of the Bankers’ Books Evidence Act 1879, a statute of general application (usually relied upon by the Police) reads:

“On the application of any party to a legal proceeding a court or judge may order that such party be at liberty to inspect and take copies of any entries in a banker’s book for any of the purposes of such proceedings. An order under this section may be made either with or without summoning the bank or any other party, and shall be served on the bank three clear days before the same is to be obeyed, unless the court or judge otherwise directs.”

There is clearly nothing in Section 7 of the Bankers’ Books Evidence Act 1879 expressly stating that an account may be frozen or that monies therein be transferred to any person.

What is expected of the Police and the Magistrate?

The law is not an ass. The Police is empowered by law to write the bank in our scenario to obtain information pertaining to any suspect for the purpose of investigation and the bank is mandated to oblige them with same. The Police has no business seeking for freezing or reversal orders and the Magistrate has no business granting such application.

In genuine cases, all the Magistrate needs to grant, perhaps, is a freezing order so that the supposed criminal will not make away with the funds. It is highly prejudicial to grant a reversal order where proper investigation has not been carried out and the parties have not been heard in open court.

What is expected of the Bank?

The bank is expected to adopt a standard practice and ensure that its customer (like Mr. B) does not suffer any injustice. Thus, the disputed funds may be reasonably moved to an escrow account by the bank but never to be transferred to a complainant (like Mr. A) whose complaint remains an allegation to be proved upon hearing both sides. This is one way the bank can protect its customer. Thereafter, the bank may then apply to a High Court for further directives regarding the disputed funds or apply to pay same into Court by way of interpleader summons. The Court has recently supported such move.

Recently, the Court of Appeal held that: “Our financial institutions must not be complacent, reticent and toothless in the face of brazen and reckless violence to the rights of their customers…”

Conclusion

We commend the Nigeria Police for their efforts in combating crime. However, the Police must desist from obnoxious use of the Bankers’ Order and stop allowing itself to be an instrument in the hands of unscrupulous elements in the society. The Police must rise up to its duty by ensuring that prompt investigation is carried out whenever necessary. They must ensure that more sensible procedures are adopted. The legal department must be manned by those who do not just parade paper qualifications (and enjoying the title of “OC Legal”) but by highly qualified personnel who will give the needed legal guidance at all times. Our Magistrates must also take note and be more alive to duty. Justice is not only for one person. Justice is for both parties and the court.