Prior to the austerity measures decreed by the apex bank, fraudulent bankers like Mrs. Cecilia Ibru, the convicted former managing director of the defunct Oceanic Bank, had used casualisation to defraud both her bank and some of its lower ranking staff.
Those affected were mostly drivers and security men. She floated a company which recruited those categories of staff for the bank at N30, 000 per month. However, on the records of Oceanic Bank, those lowly workers were collecting N150, 000 per month. The difference between their real pay of N30, 000 and the N150, 000 on the books of the bank, went to Mrs. Ibru. She atoned for her inhuman crime by donating generously to her church.
With the apex bank decreeing massive cuts in bank workers remuneration, the banks took casualisation to levels never imagined by Mrs. Ibru. They outsourced everything from security jobs to deposit mobilization. Even the tellers on the desks of most of the banks are casual workers.
Most of the companies supplying the banks with casual staff are owned by the directors of the outsourcing banks. The graduates recruited for the jobs are offered starving wages ranging from N60, 000 and given Herculean monthly targets to meet. The outsourcing company collects N40, 000 monthly from the starving wage of each slave labourer.
Ironically most of the casual workers do not carry the ID cards of the banks they mobilize deposits for. That implicitly makes depositors the first casualty of the banking system’s casualisation policy. With the implicit legalization of casualisation in the banking system, Nigeria and bank depositors are sitting on a ticking time bomb.
Nothing stops a tricky casual deposit mobiliser from fleeing with millions of the raised deposit. With the mobiliser carrying the ID card of the outsourcing company, rather than that of the bank he mobilizes for, the banks can easily disown the depositor if the money gets lost in transit. Under that circumstance, the money mobilized is purely at the risk of the depositor.
Unlike the situation in banks’ premises where customers are warned by a poster that they park cars at their own risk, depositors are unknowingly dealing with casual mobilisers at their own risk. Banks should be compelled to let depositors know the risk of dealing with casual mobilisers.
The banking system itself is deliberately toying with a dangerous cost-cutting policy that could one day wreak havoc on it. With the purchasing power of the naira receding by the day, the graduates engaged by banks as casual workers are earning below minimum wage. Yet they count millions of naira daily. That is pretty tempting.
The statistics reeled out by the CIBN may sound horrendous. However, the crime of casual workers is not proportionate to the inhuman treatment meted out to them by banks. Casual workers have no pension scheme. Their pay on the other hand is too poor for them to save for the days when they would no longer have the strength to fend for themselves. A social time-bomb is ticking. The CBN and NDIC must terminate the inhuman policy of outsourcing.
The Chartered Institute of Bankers of Nigeria (CIBN) last week reeled out statistics on banking fraud that should make depositors shudder.
Mrs. Debola Osibogun, CIBN’s president was on a courtesy visit to the Nigeria Deposit Insurance Corporation (NDIC) when she lamented that 75 per cent of the fraud in the nation’s banking system is committed by the casual workers thrown up by the inhuman and sinister policy derisively tagged outsourcing. The banks have the figures, but the proceeds of the inhuman policy are too tempting for the slave drivers to look back.
Outsourcing or casualisation was foisted on the country’s banking system by the systemic distress that rocked the global financial system in 2009. In Nigeria, the calamity was triggered by an odd combination of fraudulent risk management and insider dealings in the shares of banks listed on the Nigerian Stock Exchange (NSE).
Banks were fraudulently and excessively exposed to the country’s downstream sector of the oil industry. Suddenly oil price tumbled from $147 to $60 within a few weeks. The prices of refined petroleum products imported when crude oil price was at $147 per barrel suddenly plummeted with the price of crude. Fuel importers lost from both ends.
The imported refined products were sold at half of the landing cost, while the dollar- denominated loans raised for the imports at N116 to the dollar had to be paid back at N150 to the dollar. The Central Bank of Nigeria (CBN) had been compelled to devalue the naira as the drop in oil revenue engendered by the tumbling oil price triggered massive capital flight that drained the country’s foreign reserves.
Most of the refined petroleum products marketers who obtained massive dollar-denominated loans on self recognition could no longer pay back. They had no collaterals that the banks could grab to recover the loans. The crisis rocked the Nigerian banking system to its very foundation.
The apex bank responded to the crisis by, among other measures, ordering drastic cuts in banks’ mouth-watering staff remuneration. That directive foisted what is now known as outsourcing or casualisation on the banks.