GTB and two other banks report 26,877 fraud cases in six months

• GTB and two other banks report 26,877 fraud cases in six months
• Access Bank Plc disclosed N1.2 billion in fraud losses
• The Nigeria Interbank Settlement System
• The focus in Fraud Risk Management

According to the analysis of their financial reports for the first half of 2022, Access Bank, GTB, and Fidelity Bank reported 26,877 fraud cases in the first half of the year.
In comparison to the 61,715 fraud cases that the banks reported between June and December of 2021, this represented a 56.45% decline.

READ MORE: MTN Nigeria receives €100 million from EIB to Expand its High-speed Network

The Guaranty Trust Holding Company and its subsidiary companies reported 15,004 fraud incidents within the time period under review, in accordance with Section 5.1.2 (L) of the CBN Code of Corporate Governance. The bank said that these incidents involved N1.55 billion and $50,700, with N158.37 million recorded as actual/expected loss.

Access Bank Plc disclosed N1.2 billion in fraud losses

Likewise, Access Bank Plc disclosed N1.2 billion in fraud losses for the time period. In the first half of 2022, the bank documented 10,706 attempts at fraud. 3,602 of the attempts failed compared to 7,104 that were. These endeavors cost a total of N12.55 billion. The bank reports that 849 out of 7,928 electronic/USSD fraud cases that were documented during the review period were successful.

The largest sums were involved in fraudulent transfers, withdrawals, and account reactivations, with successful efforts totaling N9.48 billion and real losses of N1.08 billion.

Other successful and unsuccessful fraud attempts, including cash theft, suppression, pilferage, and dry posting, fell into the following categories. During the examined period, 1,167 fraud cases were reported to Fidelity Bank PLC. Although N471.01m and $8,367 were involved, the actual loss was N4.90m and $2,400.

READ MORE: UBA Revenue Increased by 23.3% to N608 billion in the Third Quarter of this Year

The Nigeria Interbank Settlement System

The Nigeria Interbank Settlement System claims that Nigeria has one of the world’s most advanced electronic payment infrastructures. It said that the expansion of channels and the speed at which transactions were processed had given fraudulent transactions a foothold.

According to the “NIBSS Insight: Fraud in the Nigeria Financial Services” report, even a 1% success rate for fraud would lead to 100,000 successful fraudulent transactions every day.

“This would directly impact customer’s faith in the entire system and could significantly impact our financial inclusion drive as well as the CBN cashless policy.”

According to GTCO, who spoke about its fraud risk management, “Causal analysis of key fraud and forgeries instances (over the counter or cybercrimes) detected in the Group or widespread in local and worldwide business environments are carried out and reported.

The focus in Fraud Risk Management

“Likely and unlikely loss estimations are also determined in the process as input in the OpRisk capital calculation process. The focus in Fraud Risk Management is to ensure that processes for preventing, deterring, detecting fraud and forgeries incidents, and sanctioning offenders are effective.”

Olugbenga Odeyemi, a senior partner at e86 Limited and an ICT expert, commented that insiders from banks were needed in a number of fraud cases.

He said, “Some of the hacking and fraud incidents we’ve seen happened not because there was a security breach on the banks’ computer platforms, but rather because of poverty, greed, and occasionally a lack of education on the part of the clients.

“Other than asking banks to invest more in the security of their platforms, it’s equally important that banks spend more resources on educating their customers.

“That said, several fraud cases couldn’t have happened without the help of insiders in some of the banks. I think Nigerian banks should spend more money on the welfare of their staff while making appropriate changes to their internal processes, starting from their hiring processes.”

Source: punchng.com