Nigerian Banks Urged To Strengthen Internal Controls As Fraud Cases Hit N2.59 billion

Nigerian banks have been urged to strengthen its internal control and sensitise customers on how to protect themselves from fraud following the revelation that fraud cases in the banking sector was N2.59b in the first quarter 2023.

The Financial Institutions Training Centre (FITC), in its latest report revealed that the total amount involved in fraud cases stands at N2.59b in the first quarter, with N472m lost to fraudsters. This implies that banking authorities were able to recover about N2.12b.

It also reported that 12,553 cases of banking fraud were recorded, representing a 14.07 per cent decrease compared to the preceding quarter, 14,609 cases.

The organisation, therefore, recommended that banks invest in advanced fraud detection technologies, such as machine learning algorithms and artificial intelligence tools, to identify and flag suspicious transactions and patterns.

“Additionally, regular risk assessments can help identify potential vulnerabilities and threats to the banking system.”

The report indicated a decline in the number of cases and the amount lost compared to the previous quarter.

Its report explained that the Q1 2023 numbers revealed that of all the fraud activities, mobile, computer/web and POS-related frauds were the top three with the highest number of occurrences, which was consistent with the trend from the previous quarter.

It also noted that staff involvement increased to 72 cases in Q1 2023 from 38 cases in Q4 2022 representing 89.47 per cent increase. Also, there were 124 unspecified cases and six collusion cases.

The report also revealed that there was a 79.44 per cent decrease in the total amount involved in fraud cases in Q1 2023 compared to the previous quarter. The sum decreased from N12.58b to N2.59b.