Court Freezes Bank Accounts After Keystone Bank Glitch

A Nigerian court has ordered the freezing of multiple bank accounts after a technical glitch at Keystone Bank artificially inflated account balances, allowing customers to withdraw a total of ₦5.7 billion, according to court filings seen by TechCabal.

Court Order and Banks Affected

Justice D.E. Osiagor of the Federal High Court in Lagos issued a motion on February 18, 2025, directing banks to block transactions on the affected accounts until further hearings.

The frozen accounts are spread across 11 banks, including:

Opay

Providus Bank

Sterling Bank

Access Bank

Zenith Bank

TAJ Bank

GTBank

First Bank

Moniepoint

Fidelity Bank

UBA

How the Glitch Happened

Between February 1 and February 12, 2025, a routine account review at Keystone Bank uncovered artificially inflated balances that did not match legitimate transactions.

The glitch allowed customers to withdraw unauthorized funds, with ₦5.7 billion dispersed across 21 accounts before further transfers to secondary recipients.

Investigators are now tracing the flow of funds to identify those involved in the withdrawals and recover lost funds.

Concerns Over Banking Infrastructure

This is not the first case of a major bank system error in Nigeria:

➡️ In January 2025, GTBank secured a court order to recover ₦1.9 billion mistakenly credited to customers following an October 2024 system failure.

➡️ Analysts warn that outdated banking infrastructure and weak oversight may be increasing the risk of system errors and fraudulent exploits.

However, a banking insider dismissed concerns, calling such glitches “highly unusual” and arguing they represent only a small fraction of total transactions.

As investigations continue, the case raises serious questions about the security of Nigeria’s banking systems and the efficiency of fraud detection measures.

Leave a Comment

Your email address will not be published. Required fields are marked *

Scroll to Top