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Banks Lose Whopping N5Bn to Fraudsters in 9 Months

Banks in the country lost over N5 billion to fraudsters within a nine-month period in 2020, according to Nigeria Deposit Insurance Corporation (NDIC).

Mrs Omotola Abiola-Edewor, executive director, Corporate Services, NDIC, disclosed this on Monday while delivering her keynote address at the annual capacity-building programme for law enforcement agencies.

The programme, with the theme “Effective investigation and prosecution of banking malpractices that led to the failure of banks in Nigeria” was held in Lagos.

According to Mrs Abiola-Edewor, who was represented at the occasion by Joshua James Etopidiok, the figure of bank losses to fraud was stated in a report recently published by the Nigeria Inter-Bank Settlement System Plc (NIBSS).

The NIBSS report disclosed that between January and September 2020, banks in Nigeria lost over N5 billion to fraudsters.

Abiola-Edewor also stated that NDIC, in its annual report of 2019, a total of 52,754 fraud cases were reported against 37,817 in 2018 and 26,182 in 2017.

She said the amount involved in the fraud cases stood at N204.65 billion, in 2019, compared to N38.93 billion in 2018 and N12.01 billion in 2017, adding that the total actual loss declined from N15.15 billion in 2018 to N5.46 billion in 2019.

NDIC’s Executive Director held that the fraud incidences could be attributed to the increase in the sophistication of fraud-related techniques, such as hacking, cybercrime as well as an increase in Information Technology related products and usage, fraudulent withdrawals and unauthorised credit.

‘The channels and instruments through which the reported frauds and forgeries were perpetrated indicated that ATM/Card-related fraud had the highest frequency, accounting for 49.78 per cent of fraud cases followed by web-based internet banking frauds with 21.02 per cent, however, the value of losses was higher in web-based internet banking frauds against ATM card-related fraud,’ she said.

She noted that NDIC, collaboration with sister agencies in law enforcement was to curtail such crimes which are capable of causing irreversible damage to the stability of the banking system.

Also speaking at the event, Mr BA Taribo, director, Legal Department, NDIC, said the objective of the workshop is to develop capacity amongst law enforcement agencies in the investigation and prosecution of banking malpractices, with special emphasis on failed banks.

He said the workshop would provide the needed synergy among the relevant NDIC staff and the relevant law enforcement officers involved in fighting banking fraud.

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