Recently hundreds of thousands of South Africans – your correspondent included – were hit by mysterious R99 debit orders.
The debit orders were deducted in late October, with the reference ‘Nconnups’. Moneyweb’s attempts to identify the recipient have proven fruitless.
On enquiring with their respective banks, victims of the debit orders were informed that they were processed by Umvuzo Payment Solutions. Umvuzo is a third-party processor of debit orders, which means it debits accounts on behalf of clients. These clients are supposed to be legitimate businesses such as insurers and gyms.
Every third-party debit-order processor must have a sponsor bank. This bank grants access to the payments system. It is the bank’s responsibility to ensure that its client is above board and processes legitimate debit orders.
According to the Payments Association of South Africa, Umvuzo’s sponsor bank is Standard Bank SA.
Umvuzo does not have a website. Our attempts to contact it telephonically have been unsuccessful. The number given by banks to people who dispute Umvuzo’s debit orders – 011 483 1188 – goes unanswered.
Umvuzo’s comments will be added to this article if they are provided.
A source at a big bank (not Standard Bank), who spoke on condition of anonymity, says the Nconnups debit orders were considered so suspicious that the bank took a decision to protect its clients by reversing all of them, regardless of whether they were disputed or not. This amounted to over 150 000 debit orders.
For a rough estimate of the total number of Nconnups R99 debit orders across all ‘big five’ banks, one could multiply 150 000 by five to get 750 000. At R99 each, that makes a total of R74 million. Even if the majority of debit orders are reversed, the potential gains for the mystery recipient are still substantial.
Moneyweb contacted Standard Bank to request the following information:
- The identity of the mystery recipient
- Whether Standard Bank intends to reverse all Nconnups debits that affected its own retail clients
- Whether Standard Bank has initiated an investigation into Umvuzo’s vetting of clients.
Standard Bank provided a response, but did not answer the questions. Instead it detailed what actions victims of debit order abuse should take.
Moneyweb requested an interview with the person at Standard Bank responsible for the Umvuzo account but received no response.
Standard Bank’s full response follows:
Standard Bank regards the safety and security of our customers as crucial and has a zero tolerance approach to fraud of any nature. Customers who notice an unauthorised debit order on their accounts are encouraged to contact their bank immediately to reverse the transaction. This can be done at a branch or through the call centre on 0860 123 000. There are no fees associated with this reversal as long as the transaction is reversed within 40 days of the transaction taking place. Customers who feel that they have been incorrectly debited or charged for a service that they did not subscribe to should also contact the company directly to stop any future debit orders. Customers are also encouraged to lay a criminal complaint with the South African Police Service. In turn, Standard Bank does report any suspicious transactions under strict regulatory guidelines to the relevant authorities.