‘Finance House Drags FCMB To Court’ — Bank Accused Of Allowing N150M Withdrawal Despite Freeze Order

The legal action, filed at the Federal High Court in Lagos, stems from a series of events that began in July 2023 when Goewe and Sons Ltd., a merchandise company owned by Ewere Godwin Orobosa, approached Cool Financial Services for a N100 million loan at a 3.5% interest rate for 30 days. In September 2023, the company secured an additional N50 million loan at a 1.5% interest rate, bringing the total loan to N150 million.

According to the loan agreement dated September 18, 2023, both parties instructed FCMB to freeze the loan account to ensure the funds remained untouched during the loan period. The borrower had also altered its account mandate through a board resolution dated September 15, 2023, appointing Ewere-Egharevba Orobosa (representing the borrower) and Roseline Anibueze (representing the lender) as ‘Category A’ signatories. The mandate stipulated that withdrawals below N150 million required authorization from the lender’s representative, while larger withdrawals needed joint approval.

However, when Cool Financial Services attempted to withdraw the loan after its expiration on October 23, 2023, the cheque was dishonored. Investigations revealed that the borrower had already withdrawn the N150 million, despite the active freezing instruction on the account.

“We were shocked to discover that FCMB disregarded the lien on the account and processed the withdrawal,” said Oluwafemi Adediran, Head of the Legal Unit at Cool Financial Services. “Even more alarming is the forgery of our director’s signature to facilitate the transaction.”

In letters dated September 26 and October 26, 2023, the lender’s legal representative, Justice John, accused FCMB of breaching its fiduciary duties and engaging in “premeditated criminal falsification” of signatures. Despite appeals from FCMB officials for additional time to resolve the issue, the bank failed to provide a satisfactory explanation or remedy the situation.

In November 2023, Cool Financial Services filed a lawsuit (FHC/2377/2023) against FCMB, Goewe and Sons Ltd., and the Central Bank of Nigeria (CBN) as the third defendant. The lender is seeking several reliefs, including:

The court has yet to fix a hearing date for the case, and FCMB has not filed a response to the lawsuit as of press time.

When contacted by FIJ, Rafiu Muhammed, FCMB’s Corporate Affairs and Media Management Officer, acknowledged the complaint and promised an investigation. However, as of January 31, 2024, the bank has not provided an official response despite multiple reminders.

Ewere Godwin Orobosa, the director of Goewe and Sons Ltd., denied allegations of signature forgery and claimed the loan had been fully repaid. “The loan has been liquidated, and we no longer owe Cool Financial Services. I am also planning to sue FCMB for their role in this matter,” he said.

Cool Financial Services, however, maintains that the borrower defaulted on the loan and illegally withdrew the funds. “The borrower’s claims are false. They defaulted on the loan and withdrew the money unlawfully,” Adediran stated.