Standard Bank says 49 of its employees face the axe after they were implicated in using their own funds to illegitimately activate bank accounts as part of a ploy to meet new business targets.
The bank denied media reports that the affected accounts were “ghost accounts”, saying they were legitimate profiles opened in the name of real people and were therefore compliant with KYC (Know Your Customer) principles. Standard Bank told Business Day on May 9 that it had charged 67 staff members with gross misconduct and dishonesty after identifying 20,000 retail client accounts that may not have been activated in line with company guidelines and procedures.
“Standard Bank confirms that the investigation relating to employees who activated new accounts without the bank’s procedures is ongoing. To date 49 staff have been suspended and are in various stages of formal disciplinary inquiry processes,” the lender said in a statement late on Tuesday.
“The bank would also like to correct media reports describing the accounts in question as ghost accounts. These accounts were KYC-compliant at the time of opening and therefore not fictitious. We take all conduct matters seriously and will continue to do so.”
Business Day understands that one of the ploys used by the implicated staff members was to use their own funds to activate the MyMo accounts of existing Standard Bank customers without their knowledge or consent to meet sales targets. Standard Bank’s MyMo account is a fully digital bank account that can be opened using a mobile device within minutes and that does not require clients to submit additional documentation.
The low-cost account can be operated through a virtual card that is created on the Standard Bank app and incurs a monthly fee of R4.95. According to Standard Bank’s website up to three MyMo accounts can be opened per customer.
Standard Bank also clarified that implicated staff had not used their own funds to create entirely new current accounts for people who had not previously been Standard Bank customers. The bank added that the number of affected accounts represented less than 0.1% of all the accounts opened in the period being investigated.
Standard Bank said in December that it had more than 10-million customers in SA and that it had attracted more than 1-million new clients in 2021.
Fin24 reported that CEO Sim Tshabalala announced on Tuesday at the company’s AGM that while Standard Bank has reported the issue of the illegitimately activated accounts to the relevant authorities it does not yet know how it will affect customer numbers or the bank’s finances.
Updated: June 1 2022:
This story has been updated to show that affected MyMo accounts were illegitimately activated by implicated staff. Standard Bank also confirmed that implicated staff had not opened entirely new accounts for people who were not previously Standard Bank customers.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.