Standard Bank overcharged a client by R267,000 after increasing the interest rate from prime minus 1.75% to prime in June 2009.

Before 2007, Standard Bank was regarded as one of the most reliable banks in South Africa. However, by 2009, it had become one of the most controversial institutions under the leadership of Chief Executive Officer Mr. Sim Tshabalala.

An article published by Media 24/Business on 19 March 2017, titled “Winning Women: Banking on Home Loans,” reported that Standard Bank had lost approximately R1 billion on its mortgage loan book in 2008. In response to these losses, Ms. Funeka Montjane was appointed as the Financial Director to Mr. Tshabalala. According to the article, she implemented what were described as “unconventional methods” in an effort to prevent further financial losses in the mortgage division.

These so-called “unconventional methods” were allegedly implemented from 1 June 2009 without the consent or knowledge of clients. They included the extension of loan terms from 20 to 30 years, the increase of agreed interest rates, the periodic increase of monthly service or administration fees, and the levying of unauthorised debits on client accounts.

When questioned about these actions, Standard Bank responded in an undated letter, as reflected in paragraph 5.3 of page 2 of their correspondence. The bank claimed:

“As mentioned in paragraph 4.3 above, the concession of prime less 1.750% was granted to the client because of her employment benefit with SAPO. This benefit was only applicable for the duration of the client’s employment with SAPO. The client commenced employment with Nedbank in or about 2004, and the concession rate should have been removed at this time but was not. The concession rate was only removed in 2009, some five years later.”

In paragraph 5.4, Standard Bank repeated paragraph 4.4 from the contract, stating:

“The variable interest rate quoted above (prime minus 1.750%) applies to all consumers who are SA Post Office employees. Should your employment with SA Post Office terminate for any reason, you will cease to qualify for the group scheme category interest rate and will fall within the non-group category of consumers.”

However, the client’s email dated 25 September 2025 strongly disputes this claim:

“Dear Emerald, I was never employed at the South African Post Office. I was employed by Nedbank from July 2000. It seems that section 4.4 of the original contract dated 3 May 2007, which I attach hereto, was amended.”

From the original contract dated 3 May 2007, it appears that paragraph 4.4 was fraudulently altered. This serious allegation suggests that Standard Bank modified official loan agreement details without the client’s consent or authorization.

The matter has since been referred to the National Financial Ombud Scheme (NFO) and the Commercial Crime Unit for investigation.