The National Financial Ombud Scheme South Africa (NFO) has warned of a rise in complaints linked to the misuse of personal bank accounts as effort to curb financial crime is increasingly colliding with the country’s growing informal economy.
There has been a rise in complaints where individuals allow third parties to use their bank accounts often in exchange for small payments, only to be caught in anti-fraud controls enforced by banks.
Mule accounts
Nerota Maseti, Lead Ombud for the NFO banking and credit division, said at the centre of the issue is the rise of “mule accounts”, which are bank accounts used to move or conceal illicit funds.
These accounts are often associated with organised crime but Masetti highlights that many cases now involve everyday consumers lured by small financial incentives into allowing third parties to channel money through their accounts.
Maseti said a surge in cases has been observed where ordinary customers are drawn into scams or informal financial arrangements.
Quick returns promises
These arrangement are frequently linked to online trading or what may be referred to as investment opportunities, promise quick returns but expose participants to severe regulatory consequences.
“Termination must follow the correct procedure, be based on fair reasons, and, where appropriate, customers must be given sufficiently detailed explanations,” said Maseti.
In 2025, the NFO finalised 8 325 cases with 8% involving account closures or restrictions due to suspected fraud, this reflects an increase of 300 cases compared to the previous year.
Of these, 73% were account freezes, while 16% resulted in fraud listings by the Southern African Fraud Services (SAFPS).
Shady online trading deals
Maseti said in a recent complaint, a consumer, introduced by a friend to a supposed cryptocurrency trader, was persuaded to open multiple accounts to receive payments from the trader’s customers. She transferred the funds as instructed, but the bank flagged the activity as suspicious. Unable to provide a legitimate explanation, her accounts were frozen. An NFO investigation found the accounts bore the hallmarks of mule activity.
She said banks are legally obliged to freeze accounts where fraud is suspected, and account holders remain responsible for all transactions conducted through their accounts, regardless of third-party involvement.
In one case, a customer was listed by the Southern African Fraud Prevention Service (SAFPS) after submitting fraudulent payslips for vehicle finance. The NFO’s investigation revealed that the salary payments reflected on his bank statements were not from an employer, but transfers between his own accounts, which is a deliberate attempt to fabricate income.
Banks can terminate relationship
Maseti said banks were legally and contractually entitled to terminate customer relationships, with most banking terms and conditions containing clauses to this effect.
“Termination must follow the correct procedure, be based on fair reasons, and, where appropriate, customers must be given sufficiently detailed explanations,” said Maseti.
The data suggests banks are prevailing in most disputes. According to the NFO, 77% of complaints were resolved in favour of banks, compared to 23% in favour of customers.
“Banks may also act immediately, freezing or closing accounts without prior notice, particularly where fraud or unlawful activity is suspected. These measures align with obligations under financial crime legislation and the Conduct Standard for Banks issued by the Financial Sector Conduct Authority.
“Consumers may be listed with the SAFPS for up to 10 years, restricting access to financial services and even employment opportunities. Banks must also report suspicious activity to the Financial Intelligence Centre, which may lead to SAPS prosecution for serious charges such as money laundering,” Maseti said.
Beyond the legal risks, the data reveals a socio-economic dimension as complaints disproportionately affect lower-income consumers, particularly those earning below
R80 000 annually, suggesting financial vulnerability is being exploited. Gauteng accounts for the highest concentration of cases, followed by KwaZulu-Natal and the Western Cape, while men make up 61% of complainants.
‘Avoid easy money schemes’
The NFO’s warning is unequivocal. Consumers should never allow third parties to use their bank accounts, avoid easy money schemes, ensure account activity matches its intended purpose, and provide accurate information when applying for credit.
“Failure to follow these precautions may result in account freezes, closures, fraud listings, and long-term financial exclusion.
“While these punitive measures may appear severe, they are essential to combat financial crime and protect the integrity of South Africa’s financial system,” said Maseti.
- The National Financial Ombud Scheme South Africa (NFO) reports a rise in complaints involving "mule accounts," where people allow third parties to use their bank accounts to move illicit funds, often in exchange for small payments.
- Many affected consumers are drawn into scams or informal schemes promising quick returns, such as online trading or cryptocurrency deals, resulting in account freezes and fraud listings.
- Banks are legally required to freeze and can terminate accounts suspected of fraud following fair procedures, with 77% of related disputes resolved in favor of banks.
- Financial crime measures disproportionately impact lower-income individuals, particularly in Gauteng, KwaZulu-Natal, and the Western Cape, highlighting socio-economic vulnerability.
- The NFO advises consumers to avoid easy money schemes, never let others use their accounts, ensure legitimate account activity, and provide accurate credit information to prevent severe penalties and financial exclusion.
Nerota Maseti, Lead
Maseti said a surge in cases has been observed where ordinary customers are drawn into scams or informal financial arrangements.
“Termination must follow the correct procedure, be based on fair reasons, and, where appropriate, customers must be given sufficiently detailed explanations,” said Maseti.
In 2025, the NFO finalised 8 325 cases with 8% involving account closures or restrictions due to suspected fraud, this reflects an increase of 300 cases compared to the previous year.
Of these, 73% were account freezes, while 16% resulted in fraud listings by the
Maseti said in a recent complaint, a consumer, introduced by a friend to a supposed cryptocurrency trader, was persuaded to open multiple accounts to receive payments from the trader’s customers.
In one case, a customer was listed by the
Maseti said banks were legally and contractually entitled to terminate customer relationships, with most banking terms and conditions containing clauses to this effect.
“Termination must follow the correct procedure, be based on fair reasons, and, where appropriate, customers must be given sufficiently detailed explanations,” said Maseti.
“
“Consumers may be listed with the SAFPS for up to 10 years, restricting access to financial services and even employment opportunities.
R80 000 annually, suggesting financial vulnerability is being exploited.
“Failure to follow these precautions may result in account freezes, closures, fraud listings, and long-term financial exclusion.
“While these punitive measures may appear severe, they are essential to combat financial crime and protect the integrity of
