Federal High Court Upholds CBN’s Social Media Directive for Banks

The Federal High Court in Lagos has dismissed a lawsuit against the Central Bank of Nigeria (CBN), thereby affirming the bank’s directive that allows financial institutions to request customers’ social media handles as part of their Know-Your-Customer (KYC) procedures.

The case, which has drawn significant public attention, challenged the constitutionality of the CBN’s June 2023 directive. The plaintiff, a Lagos-based lawyer, argued that the regulation infringed upon citizens’ right to privacy as guaranteed by Section 37 of the 1999 Constitution.

However, Justice Nnamdi Dimgba, presiding over the case, held that the CBN is within its constitutional powers to issue such directives aimed at preventing financial crimes and enhancing the precision of KYC processes. The judge further clarified that the regulation applies to financial institutions and not directly to individuals, and as such, does not infringe on individual privacy rights.

The verdict has sparked a flurry of reactions across the nation, with a segment of the populace lauding the move as a proactive measure to curb financial crimes. Conversely, some citizens and privacy advocates are raising alarms over the potential misuse of personal data.

As it stands, Nigerian banks are now legally bound to implement the CBN’s directive, marking a new era in the country’s financial services sector. The CBN assures the public that the collection of social media handles is solely for enhancing KYC protocols and that stringent measures are in place to protect customers’ data.

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