Nova Bank In Deep Trouble As Sunrise Products Ltd Sues Her Over Alleged Debt Inflation, Illegal Charges.

Nova Bank.

A plastic manufacturing company, Sunrise Products Limited, has taken legal action against Nova Commercial Bank Limited at the Federal High Court in Lagos, accusing the bank of inflating its debt through illegal charges and enforcing liabilities it claims do not exist.

Also named in the suit is Emerging Africa Trustees Limited. The company is seeking ₦10 million in damages and an additional ₦5 million to cover legal costs.

In its statement of claim, filed by its lawyer, Barrister Sivbone Edu, Sunrise Products alleged that the bank manipulated its account records and issued conflicting debt figures in a bid to wrongfully recover funds.

The dispute is linked to a $1.5 million import finance facility granted to the company in February 2020 for the importation of raw materials, including polyethylene and polypropylene.

Sunrise Products maintained that it fulfilled all obligations tied to the facility, including providing the required naira backing for Form M transactions and Letters of Credit, with payments made as agreed.

However, the company claimed that despite meeting its responsibilities, the bank began making what it described as inconsistent and unsupported claims of indebtedness.

According to the firm, its account records showed a debit turnover of over ₦4.48 billion and a credit turnover of about ₦4.49 billion, leaving a positive balance of roughly ₦14 million as of May 2022.

It further alleged that the bank’s claims fluctuated widely, ranging from $1.89 million in April 2022 to $420,213.78 in November 2022, and later dropping to $225,781 in January 2023 before rising again to over $2 million in August 2023.

By March 2024, the bank reportedly demanded $2.16 million and threatened to debit the company’s accounts or convert its naira funds at prevailing exchange rates.

Describing the situation as a pattern of inconsistency and financial misrepresentation, the company engaged Bizancom Support Services to carry out a forensic audit of its transactions.

The audit reportedly uncovered discrepancies, including unexplained debits and undocumented charges, while attempts to get clarification from the bank were allegedly ignored.

The matter was later taken to the Sub-Committee on Ethics and professionalism of the Bankers’ Committee, which, according to the plaintiff, found merit in the complaint and concluded that excess and unlawful charges had been applied.

The committee reportedly identified excess charges of ₦1,969,941.37, which rose to ₦3,879,387.75 with interest—an amount the bank allegedly refunded.

Despite this, Sunrise Products claimed the bank continued enforcement actions, including attempts to rely on a debenture agreement to assert control over its assets without clearly establishing the debt.

The company is now asking the court to declare the bank’s claimed debit position as disputable and to restrain the defendants from enforcing provisions in the debenture trust deed executed in May 2020.