The US branch of the Groupe Nduoum bank, owned by a Ghanaian entrepreneur, Paa Kwesi Nduoum, is in the news for alleged sharp practices that seek to take advantage of customer forgetfulness to perpetrate mortgage fraud.
According to a news report by a US-based report, the managers of the bank use stone-age accounts keeping and would often spring shocking surprises on mortgage customers – by claiming that they had stopped paying their mortgages even though the customers have been faithful.
In circumstances like this, customers who have not diligently kept their mortgage payment records could easily be victimized by having themselves dispossessed of houses that they have duly been paying mortgages on.
Customer complaints have led to US banking regulators visiting the bank. However, because GN is the last black-owned bank in Chicago, which is the state with the largest black population in the US, the customers say they still want Paa Kwesi Nduoum’s bank to succeed.
Per the CBS report, the bank is under a federal consent order that noted several deficiencies that need fixing fast.
GN Bank used to be called Illinois Service Federal Savings and Loan (ISF) which had been in operation since 1934, offering mortgages, homeownership assistance, and access to banking for Chicago’s underserved Black neighbourhoods.
But when the 2008 recession hit, many banks, including ISF, began to struggle.
By April 16, 2015, ISF was under a federal consent order issued by the Office of the Comptroller of the Currency (OCC), one of the agencies tasked with regulating banks and financial institutions.
The order required the bank to come up with a plan to get out of financial trouble and to hire competent management.
A year later, Dr. Papa Kwesi Nduom bought ISF and rebranded it into GN Bank
Nduoum, a former Minister under Kufuor, had agreed to take control of ISF and pump $9 million into it.
In the CBS report, the plight of, Sharon Stewart, a customer of the bank who had continued her late mother’s 30-year loyalty after ISF transitioned into GN Bank, was highlighted.
“It was a sense of pride,” she said, “They invested in the community and helped African Americans get mortgages.”
Stewart says her mother also enjoyed the intimate, friendly customer service at ISF.
“She could go in there and talk to them personally,” Stewart said. “She loved it. Absolutely.”
Eventually, Stewart added her name to the mortgage and carried on that commitment to support what eventually became GN Bank — and ultimately became the last Black bank in Chicago.
She has a different feeling about the bank today.
“I am very disappointed. I’m so disappointed with them,” Stewart said. “They take your money. They do nothing for you.”
Stewart told CBS 2 that since GN took over, customer service has gone downhill.
“There’s no one to speak to,” she said. You can’t talk to anybody.”
She also said normal banking procedures are not followed.
“I don’t even get bank statements,” Stewart said.
Worst of all, she said, is the time she thought she might lose her mother’s home.
But Stewart found out that GN Bank had sold the mortgage to Yorke Properties, LLC. Dr. Nduom is Chairman of GN Bank. He’s also listed on state LLC records as a manager of Yorke Properties.
Stewart received a collection notice in 2021. The notice informed her that she was in default on her mother’s Yorke Properties mortgage loan.
She had to prove the loan was current to avoid foreclosure.
Stewart started going to GN Bank every month to make the loan payments after that. She described her monthly routine: “I presented the check with the loan numbers on because there are no payment coupons — nothing. So I always write [on] a piece of paper the address, my mother’s name, my name, the check number, how much I’m paying, the loan numbers that they told me are the loan numbers — and I always write a statement that GN Bank does not provide annual or monthly statements, nor payment coupons.”
After the payment is made, Stewart explained: “They’ll give me a handwritten receipt. From a financial institution — that’s my receipt. It’s like the Flintstones. That’s what I call it.”
Back to the fear of foreclosure. Stewart kept all of those handwritten receipts and cancelled checks totalling $60,000 to prove to GN Bank that the loan was not in default.
She blames this whole mortgage mix-up, missing statements, and antiquated receipts on the chairman of the bank, Dr. Nduom,.
“They do not run it like a financial institution in the United States at all,” Stewart said.
Stewart is not the only customer complaining. Robert Jansen drives 110 miles each way from his home in Marseilles to GN Bank in Bronzeville every month to also make his mortgage payments. He’s a real estate investor – so he has a lot of them.