Nigeria’s Central Bank Implements 24-Hour Watchlist for Suspected Fraud BVNs

The Central Bank of Nigeria (CBN) has issued a directive requiring the nation's financial institutions to immediately flag Bank Verification Numbers (BVNs) suspected of involvement in fraudulent activities. According to a circular released late Thursday, banks must now place these identifiers on a temporary watchlist, effective May 1, 2026, as part of a broader strategy to secure the financial system.

Background and Context

This new mandate is outlined in an addendum to the CBN's 2021 Revised Regulatory Framework for Bank Verification Number Operations and Watch-List for the Nigerian Banking Industry. The central bank describes the policy as a necessary step to maintain stability and combat illicit financial flows within the sector. The updated framework introduces four specific policies designed to close regulatory gaps and enhance the monitoring of customer identities.

Key Figures and Entities

The directive was signed by Musa Jimoh, the Director of the Payment Systems Policy Department at the Central Bank of Nigeria. It mandates that all deposit money banks and financial institutions under the CBN's purview establish mechanisms to comply with the new watchlist protocols. The regulations apply specifically to the management of BVNs, a unique identifier introduced to reduce identity theft and fraud in Nigerian banking.

Legal and Financial Mechanisms

Under the new regulations, financial institutions are required to establish a temporary watchlist for BVNs implicated in reported suspicious transactions. The framework stipulates that a BVN may remain on this list for a maximum of 24 hours, during which the account owner must be contacted to clarify the transaction.

Additionally, the circular imposes stricter controls on data integrity. Updates to phone numbers linked to a BVN will be restricted to a single amendment, potentially curbing the ability of fraudsters to hijack accounts by changing contact details. Furthermore, the framework reiterates that BVN enrolment is strictly for individuals aged 18 and above. Access to the BVN database remains exclusive to CBN-licensed financial institutions, though the central bank reserves the right to grant access in extenuating circumstances.

International Implications and Policy Response

While focused on domestic banking, these measures align with global efforts to strengthen Anti-Money Laundering (AML) and Counter-Terrorist Financing (CTF) standards. By tightening the window for investigating suspicious BVNs and restricting data alterations, the CBN aims to improve the transparency of Nigeria's financial sector. Such measures are critical for reducing the country's risk profile in global financial indices and maintaining correspondent banking relationships.

Sources

This report is based on the circular titled “Addendum to the Revised Regulatory Framework for Bank Verification Number Operations and Watch-List for the Nigerian Banking Industry,” issued by the Central Bank of Nigeria and public statements from the Central Bank of Nigeria.