* And failure to disclose material information, and unfair consumer contracts
* As the CFTC orders six companies to pay administrative monetary fines totaling MK361 million for different violations as provided under the Competition and Fair Trading Act
By Duncan Mlanjira
The Competition & Fair Trading Commission (CFTC) has fined Standard Bank with K100 million and FDH Bank K200 million for engaging in misleading conduct, unconscionable conduct and failure to disclose material information, and unfair consumer contracts.
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CFTC have disclosed this in a statement which indicates that it has ordered six companies to pay administrative monetary fines totaling K361 million for different violations as provided under the Competition and Fair Trading Act (CFTA).
The six companies have also been ordered to pay refunds to consumers amounting to over K126 million as determined by CFTC’s Board during its 75th Meeting held on May 8, 2026, that considered and adjudicated over cases of anti-competitive business practices and unfair trading conducts.
The statement, presented by CFTC Chief Executive Officer, Desmond Kaunda, highlights that a complainant obtained a loan of K4.5 million on October 22, 2021, which was to be repaid over a three-year period, ending in October 2024.
CFTC CEO, Desmond Kaunda
But, as she reported to the CFTC, the deductions continued beyond October 2024, contrary to the agreement on the duration of the loan and when she raised concerns early in the process, Standard Bank “failed to properly clarify the discrepancies and instead sought to rectify internal errors, which came at her expense”.
When the bank investigated, it discovered that “an inadvertent default change in their system had resulted in the loan tenure being set to five years — instead of the contracted three years”.
“They noted that due to this change, lower monthly repayments were charged to the loan. Consequently, this resulted in the complainant paying less than the amounts required to satisfy the debt within the original three-year contracted period.
“Considering that the loan was overbooked, [Standard Bank] unilaterally resolved to extend the loan’s period from three years to five years” — thus upon consideration of the facts and the loan agreement, the CFTC found that Standard Bank “failed to disclose material information relating to changes in the loan term and repayment arrangements”.
“The investigations further found that Standard Bank’s terms and conditions gave it powers to unilaterally vary the parameters of the loan during the loans lifespan” — which the CFTC thus determined that the the bank contravened Sections 51(g), 51(p), and 52 of the CFTA.
Standard Bank was thus ordered — on top of the K100 million penalty — to write off the loan and refund the complainant all the monies deducted from the Complainants account from November, 2024 to date and to provide details of deductions made to the complainant’s account.
And that Standard Bank should amend the unfair clause in their contract, which states ‘the Bank may at its discretion be entitled to vary any of the terms and conditions from time to time on written notice’.
On FDH Bank, CFTC indicated that in April 2025, it received a complaint that a customer obtained guarantee and overdraft facilities in February 2023 totaling MK150 million, which included a Keyman insurance requirement linked to its co-founder.
But FDH Bank unilaterally effected changes upon renewal of the facilities in 2024, which were restructured to K130 million, with the overdraft reduced and the Keyman insurance clause omitted.
“However, a deduction of K200,000 was later made from the complainant’s account being indicated as credit life insurance, which was later linked back to the Keyman insurance cover.
“The complainant further observed that FDH Bank had altered ‘the Keyman’ for insurance cover and then had created another Keyman insurance under a different person. Following the death of the Keyman (the founder of the company) in April 2024, the complainant sought indemnification under the original guarantee.
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“FDH Bank declined the claim, stating that the Keyman insurance had lapsed and was not renewed. The Bank further claimed that the K200,000 that was deducted was merely an error that would be refunded.”
The CFTC further reports that the complainant thus submitted that “FDH Bank unilaterally altered insurance terms, changed the insured person (the Keyman) without consent, made unexplained deductions from their account, and failed to provide sufficient clarifications”.
“This resulted in significant financial losses and contractual uncertainty for the complainant. The Commission found that FDH Bank’s removal and alteration of the Keyman insurance without proper disclosure, coupled with erroneous deductions, deprived the complainant of material information and amounted to misleading conduct — contrary to Sections 51(d) and 51(p) of the CFTA.
“Furthermore, the Commission found that the unilateral variation of insurance terms created an unfair imbalance in the contractual relationship, contrary to Section 52(1) — that is was also determined that FDH Bank’s conduct was unconscionable, as it involved the unjustified alteration of key risk protections and the exploitation of a vulnerable commercial position, contrary to Section 51(g).”
The CFTC determined that “as a result, complainant suffered a financial loss arising from a K120 million deduction and the loss of expected indemnification” and also that the Commission’s investigations found that the deduction of the K120 million put the complainant’s account in overdrawn position — thereby incurring further charges for the account being in overdraft”.
Thus on top of the K100 penalty “for engaging in misleading conduct, unconscionable conduct, failure to disclose material information, and unfair consumer contracts, CFTC further ordered that:
* FDH Bank should refund K200,000 to the complainant, being the amount erroneously deducted for the purported creation of Keyman insurance;
* FDH Bank should reverse the K120,000,000 deducted from the complainant’s account, as the liability arose from a contract formed through unfair trading practices regarding insurance cover; and
* This refund must include interest accrued to date, plus interest accrued on the overdraft and that FDH Bank must report to the CFTC on the steps undertaken within 30 days.
The CFTC indicated that it adjudicated over a total of 14 cases out of which 3 were closed at preliminary stage, due to among others lack of merit and early resolution of the issues at hand.
Among those it delivered concluding penalties include Nitro Phos Limited, CTS Courier, CTS Courier, Modern Dry Cleaners and Urban Realtors.
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