Standard Bank has dismissed 82 employees, more than half of whom are from the Western Cape, for their role in the illegitimate activation of digital bank accounts held in the name of clients without their consent.
A further eight Standard Bank employees are awaiting the conclusion of disciplinary processes after a more than year-long investigation into the scandal, which first came to the bank’s attention in the final quarter of 2021 after a staff member blew the whistle on the issue. That means the total number of dismissed employees implicated in the scandal could swell to 90 once the disciplinary process is complete.
“This investigation was extremely complex — it took over a year to conclude,” Funeka Montjane, CEO of consumer and high net worth banking at Standard Bank, told Business Day in an interview.
The largest concentration is in the Western Cape “and you can see it’s people who potentially know each other. It’s there in other provinces but very sporadically.”
Africa’s biggest lender revealed in May 2022 that it had initially charged 67 staff with gross misconduct and dishonesty for using their own funds to illegitimately activate the MyMo accounts of existing Standard Bank customers without their knowledge as part of a ploy to meet new business targets. However, the total number of employees implicated soon grew as the bank realised the MyMo account issue went far beyond the Western Cape, where it first originated.
Standard Bank’s MyMo account is a fully digital bank account that can be opened using a mobile device within minutes and does not require clients to submit additional documentation. The low-cost account can be operated through a virtual card created on the Standard Bank app and incurs a monthly fee of R5.95. Up to three MyMo accounts can be opened per customer.
Standard Bank had initially thought up to 20,000 client accounts may have been implicated in the illegitimate MyMo account activation debacle. However, Montjane says subsequent investigations revealed that less than 3,000 illegitimate accounts had actually been opened, less than 0.1% of the bank’s 2-million MyMo account base.
“We looked through a big pool of people ... we wanted to be really thorough,” said Montjane. “We’ve got relatively strong whistle-blowing processes that allows us to identify this relatively early, within months of it happening.”
The investigation was led by Standard Bank’s internal forensic investigators located in its group risk unit. Their findings were vetted by an independent audit firm, which conducted a “completeness test” on the internal investigation, while an international consulting firm was also appointed to do a review of the bank’s internal culture and staff conduct.
“We don’t have their permission to disclose their names, but they’re international consultancies,” Montjane said when asked about the identities of the audit and consulting firms. “We didn’t want to miss anything.”
Montjane says the plan to illegitimately activate MyMo accounts originated in the Overberg region of the Western Cape where eight team leaders at branch level and one regional manager appear to have masterminded the plan. From there it spread to other branches and regions, resulting in the bank eventually investigating more than 200 staff for potential involvement.
“It started off in the Western Cape,” said Montjane. “We realised that it might be a problem beyond the Western Cape ... probably around late March to early April [2022]. That’s when we said if it could happen in the Western Cape, let’s look where else it could have happened.”
Montjane reiterated Standard Bank’s view that the affected MyMo accounts were not “ghost accounts” as they were legitimate profiles opened in the name of actual clients. That means they were compliant with KYC (Know Your Customer) principles.
“We can categorically confirm that these are real clients — KYC was done,” said Montjane. “It goes without saying that people did something wrong, but we double-checked and triple-checked that there was no client money lost.”
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