Banks Lose N15.15Bn to Frauds in 2018 – NDIC Report, Temporary Staff Involvement in Fraud Increases.

Nigeria Deposit Insurance Corporation (NDIC) has disclosed that Banks in Nigeria lost N15.15 billion to cases of fraud in 2018 which represents an alarming increase of 539% when compared to the N2.37 billion lost recorded in 2017.

NDIC in its 2018 Report, also disclosed that the actual total amount involved in fraud in the year under review stood at N38.93 billion compared to N12.01 billion in 2017. The amount lost to fraud in 2018 was N15.15 billion compared to N2.37 billion lost recorded in 2017. The total fraud cases reported in 2018 was 37,817 compared to the 26,182 fraud cases reported in 2017.

NDIC attributed the increase in fraudulent cases to “the increase in the sophistication of fraud-related techniques such as hacking, cybercrime as well as increase in IT-related products and usage, fraudulent withdrawals and unauthorised credit.”

According to the report, Internet and technology-based sources of fraud have the highest frequency, accounting for 59.2% of fraud cases and 42.83% of the actual total loss suffered.

The number of ATM/card-related fraud cases, however, declined from 16,397 in 2017 to 10,063 in 2018. The report said: “That may be attributed to improved security features of the card as well as security awareness on the part of users.”

But web-based fraud cases, however, increased from 7,869 in 2017 to 12,343 in 2018, the report noted.

Notably, some of the fraud and forgery cases had staff involvement with a total of 899 staff involved in fraud and forgery cases in 2018 compared to 320 in 2017.

The report stated that the number of temporary staff involved in fraud was 394, accounting for 43.83% of the total number of staff involved in frauds.
This was followed by officers and executive assistants’ cadre with 206 or 22.91%. Supervisors and managers accounted for 119 or 13.24% of the total fraud cases.

NDIC said the number of temporary staff involved in fraud and forgery cases had consistently been on the increase. DMBs (Deposit Money Banks) and regulators need to address the problem of contract/temporary staff in terms of welfare and permanent employment in view of the risk their current status poses to banks operations.

Furthermore, banks should strengthen their internal controls and validate their recruitment process,” it added.

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