All cash theft instances reported during the time period, according to the FITC’s “Report on Frauds and Forgeries in Nigerian Banks” Q3, 2022, were committed by bank employees.
According to the 18-page report, specifically, 19. 314 cases were reported in the third quarter of 2022, down from 20. 195 cases observed during the same period in 2021, or 4.36 percent fewer cases overall.
But the overall sum involved fell from N34.8 billion to N9.62 billion, a reduction of 72.34 percent. However, the overall loss during the same period in the previous year was N853,167,293.61 (2021) as opposed to N3.62 billion in Q3, 2022, which represents an increase of 324.50%.
According to FITC, foreigner involvement in the scams increased, rising from 14,243 in Q3, 2021 to 16,125 a year following, which was a 324.50 per cent growth. Insider (employee) involvement dramatically expanded, rising by 250% from 32 in Q3, 2021 to 112 in Q3, 2022. Within this period, 14 positions were terminated in Q3, 2021 while 20 bank workers were removed of their jobs a year following.
With 10 people conspiring, four bank employees and five outsiders were involved in 22 reports of tellering fraud during the review period, totaling N121, 763,258.91 with an estimated loss of N83.5 million.
Four bank employees and 12 outsiders were involved in 36 reported forgeries of checks and signatures totaling N521, 349,800.96, but N305.4 million was lost, according to FITC.
The report states that 8830 incidences of computer/web fraud occurred, involving 8911 outside parties and six bank employees. N305, 495,175.25 was lost in this, and N2, 621,953,247.60 was involved.
In terms of mobile fraud, 6631 fraud cases in total were reported, with 33 bank employees and 5194 outside collaborators involved. In this case, FITC reported N2, 669,417,856.44 were involved and N1, 222, 095,081.99 was lost within the period under consideration. 16 bank employees were involved in 16 reported cases of cash theft totaling N569.6 million, of which N452.2 million was stolen.
According to FITC, within the period, there was no clearing fraud, printing of bank papers illegally; falsification of accounts; foreign currency fraud and cross shooting of cheques and kite flying.
FITC said despite the general drop in fraud instances, the amount involved and the amount lost, it is vital for banks to improve internal control systems so that fraud activities are proactively stopped.
According to the organization, it is positive for the banking institution that fraud incidents, amounts involved, and losses have dropped.
The Financial Industry Transparency Council (FITC) stated that there is a need to review the fraud control measures in place in the actual bank branches because there has been a consistent rise in the amount involved in fraud activities and, consequently, an increase in the amount lost in the bank branches.
It states that in order to decrease fraud incidents within bank branches, all fraud control touchpoints must be carefully examined for gaps, and once these gaps are found, efforts must be taken to remedy the gaps in order to prevent subsequent occurrences.
“As always, banks should continue the ongoing sensitization of their customers on the need to protect their personal details across various channels and banking platforms,” FITC stated.
