Fresh concerns have emerged around the safety of customer deposits at Lotus Bank after the lender uncovered an alleged ₦1.5 billion internal fraud linked to one of its own officials, triggering anxiety among customers and raising fresh questions about the bank’s internal control systems.
Court documents revealed that the bank is currently battling to recover ₦1,552,130,998.85 allegedly diverted through suspicious transactions traced to Abdulkarim Arome Mohammed, a staff member in the Financial Control Department.
The shocking discovery reportedly followed an extensive internal investigation covering transactions between January 2023 and May 2024, later extended to February 2026 due to the scale of the alleged fraud.
ENigeria Newspaper reports that according to an affidavit sworn by Sunday Gbadebo, a fraud investigation officer with the bank, Mohammed allegedly exploited his access privileges within the bank’s system to channel customer-linked profits into unauthorized accounts spread across 22 financial institutions.
The development has stirred concern among depositors, especially after revelations that the suspicious transactions allegedly involved Mudarabah profit allocations funds tied to customer deposits and investment returns under the bank’s non-interest banking structure.
“We discovered suspicious Mudarabah profits were paid into some customer accounts,” the bank stated in court filings, adding that a deeper review uncovered alleged fraudulent activities connected to Mohammed.
Investigators further alleged that part of the diverted funds flowed into accounts linked to Mohammed’s wife, Khadijah Aliyu Shuaib, identified as a FINCO officer responsible for advising on profit distribution within the bank.
Other individuals named as beneficiaries in the case include Peter Daniel and Emmas Ocheja Odogwu.
The case, which reportedly dates back to May 2024, has continued to widen as more defendants are being added to the legal battle in the bank’s ongoing attempt to recover the missing funds. The latest defendant was reportedly joined in February 2026.
Industry observers say the scandal could damage public confidence in the relatively young financial institution, particularly at a time when Nigerian customers are becoming increasingly sensitive to issues involving digital banking security and internal fraud.
The matter came up before the Federal High Court in Lagos and has now been adjourned until June 16, 2026.
Efforts to obtain an official reaction from Lotus Bank proved unsuccessful. Damilola Kusimo of Lotus Bank Brand, Marketing and Communications Department did not respond to inquiries from The Witness as of press time.
ENigeria Newspaper reports that Lotus Bank commenced commercial banking operations in 2021 and operates its headquarters from Lagos, Nigeria.
