The Nigerian banking sector has been rocked by a significant increase in fraudulent activities, with banks losing a staggering N42.6 billion between April and June 2024, according to a recent report by the Financial Institutions Training Centre (FITC).
The report, which analyzed returns from 28 deposit money institutions, reveals a disturbing trend of escalating fraud losses, surpassing the total amount lost to fraud in the entire year of 2023.
*Key Highlights:*
– 8,993% increase in fraud losses compared to Q1 2024
– 637% increase in fraud losses compared to Q2 2023
– Miscellaneous and other fraud types accounted for 96.46% of total losses (N41.14 billion)
– Fraudulent activities occurred through various channels, including ATMs, online platforms, bank branches, and POS terminals
*Expert Recommendations:*
To combat the rising tide of fraud, FITC advises banks to:
– Enhance monitoring and auditing procedures
– Utilize AI-driven tools to detect unusual entries or patterns
– Conduct regular unannounced internal audits
– Strengthen access controls and implement multi-factor authentication and role-based access controls
*Industry Implications:*
The report’s findings underscore the urgent need for Nigerian banks to bolster their security measures and protect customers’ assets. As the banking sector continues to evolve, it is crucial for financial institutions to stay ahead of emerging threats and adopt proactive strategies to prevent fraud.
*Source:*
Financial Institutions Training Centre (FITC) Q2 2024 Fraud and Forgeries report.
