 "Ethiopia’s biggest bank is reportedly attempting to recover more than $40 million after a technical glitch allowed customers to withdraw more than they had in their accounts. Reuters")
A movie-like incident unfolded at Ethiopia’s largest bank, Commercial Bank of Ethiopia, over the weekend, where a systems glitch allowed customers to withdraw millions. The bank is now attempting to recover the money.
This is exactly what happened. How much money is at stake?
Bank hit by glitch, customers withdraw millions
On Saturday (16 March), customers of an Ethiopian bank found they were able to withdraw more cash than what was in their account, which immediately led to a frenzy. As the news spread via phone calls and text messages, long queues formed at ATMs in the early hours of Saturday morning.
According to the reports, most of the money that was withdrawn during the glitch was by university students. Students formed long queues at campus ATMs as they rushed to withdraw money, only stopping when police officers arrived to intervene.
According to Euronews, staff at the state-owned Commercial Bank of Ethiopia (CBE) did not immediately notice the problem, and by the time it was discovered and the bank halted transactions, approximately $40 million (Rs 332 crore) had been withdrawn.
According to local media reports, the “systems glitch” lasted for hours and more than $100 million (Rs 832 crore) was withdrawn or transferred to other banks, reports Wion.
No cyber-attack, customers’ accounts safe
During a press conference on Monday (18 March), CBE president Abe Sano stated that over 490,000 “unhealthy and illegal” banking transactions were conducted and processed. Yet, he did not confirm the amount of money withdrawn but stated that the loss was minimal in comparison to the bank’s total assets. Meanwhile, Fortune reported, citing that approximately 66,000 transactions occurred during the glitch and that up to six billion birr, or $105 million (Rs 872 crore), was withdraw
Impact Shorts
More ShortsAccording to the CBE president, the glitch occurred while they were working to improve their banking system, and the cause was a “missing code,” reports Wion. They also suspended service at the time to avoid further losses, according to Sano.
Sano also stated that the bank’s cyber security had not been compromised and that the customers’ money was secure.
Request to return the money
An investigation into the transactions is ongoing, and customers who have made “high transactions” have been reported to authorities, said Sano during the press conference. Meanwhile, universities have issued statements asking students to return money that did not belong to them. CBE says anyone returning the money will not need to fear criminal charges.
Established in 1963, the bank has accounts for more than 40 million Ethiopians.
According to a campus official at Dilla University, police are collecting money that students have voluntarily returned, reports BBC. However, a student at Jimma University stated that he had not heard of anyone returning the money.
A similar incident occurred last August at the Bank of Ireland, allowing some customers to withdraw cash in excess of their balances, reports Business Insider.
The Bank of Ireland stated at the time that there had been a “technical issue” and that any transfers and withdrawals made would still be applied to account holders’ accounts.
With inputs from AP