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Fraud cases rise by 277% as 24 banks lose N9.75b in Q2 2023

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Deposit money banks in Nigeria have reported a sharp rise in fraud cases and the amount of money lost in the second quarter of 2023, Q2’23.

The latest report also shows that the number of insider involvement rose astronomically.

 

The total amount involved in the fraud cases during the period rose to N9.75 billion, up by a whopping 276.98 per cent from N2.58 billion in the preceding quarter, Q1’23.

The total losses to the incident amounted to N5.79 billion during the period, representing a staggering 1,125 per cent rise compared with N472 million lost in the first quarter (Q1’23).

This was revealed in the new report released yesterday by the Financial Institutions Training Centre, FITC, on Fraud and Forgeries in Nigerian banks for Q2’23.

FITC further noted that the losses were recorded by 24 banks that filed their returns on fraud cases for the period, adding that outsider involvement in the fraud cases dropped by 6.4 per cent, while staff involvement rose by 22.2 per cent within the period.

FITC is owned by the Banker’s Committee, which comprises the Central Bank of Nigeria, CBN, Nigeria Deposit Insurance Corporation, NDIC, all licensed banks, and discount houses in Nigeria.

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It was established to provide innovative knowledge solutions and capacity building programmes that develop and strengthen resources for the Nigerian financial services sector.

According to the FITC report, fraudulent loans accounted for the highest loss at 94.35 percent with a value of N5.46 billion, followed by mobile fraud, which accounted for 3.39 per cent of the total loss amounting to N196 million.

The report stated: “During the second quarter of 2023, there were 11,679 reported cases, showing a 6.96 per cent decrease compared to the 12,553 cases in the first quarter. However, the data indicates a significant increase in the total amount involved in fraud cases. The amount rose from N2.59 billion in the previous quarter to N9.75 billion in Q2, representing a 276.98 per cent increase.

“Additionally, the amount lost also saw a substantial rise, increasing from N472 million in Q1 2023 to N5.79 billion in Q2 2023, which corresponds to an 1125.03 per cent increase. This increase might be attributed to the fact that banks were liable for the losses incurred and had to make refunds to customers.”

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It further stated: “In Q2 2023, there was a 6.40 percent decrease in outsider involvement in fraud cases, with the number dropping from 12,351 cases in the previous quarter to 11,561 cases. However, staff involvement in fraud increased by 22.22 per cent, rising from 72 cases in Q1 2023 to 88 cases in Q2 2023. Conversely, the number of terminated appointments related to fraudulent activities decreased by 26.67 per cent, going from 15 cases in Q1 2023 to 11 cases in Q2 2023.”

Reacting, Association of Senior Staff of Banks, Insurance Institution, ASSBIFI, said it is a sad development for the nation’s banking industry, blaming the rising cases of staff involvement on casualisation of workers and other forms of non-pensionable employment practices in the financial sector.

‘Sad development’

President of ASSBIFI, Olusoji Oluwole, told Vanguard: “This is a sad development in the banking industry. We had warned of this problem when the employment of contract workers without due diligence through third party organizations began to increase. These classesof workers without a clear career path, job security or even pension have become potential risks which are already crystallizing.

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“ASSBIFI, after about 10 years of struggle eventually got the document regulating casualisation signed by the Minister of Labour and Employment. Unfortunately some organisations are yet to adopt this regulation and the sooner this happens the better as we believe this will reduce the cases of staff-related fraud in the industry.”

Corroborating, ASSIBIFI’s Senior Assistant Secretary General, Anthony Emeh, said: “It is obvious that banks did not carry out aggressive orientation and training of staff, ensure that casualisation is discouraged and emphasis is placed more on employment of permanent staff.

Artificial Intelligence, AI, can also be adopted in some of their activities and the bank should ensure a strong internal control mechanism.

“The banks should also ensure that adequate remuneration of staff is put in place, encourage staff fraternity, interaction and also create minimal conflicts to track down impending frauds. The banks should overhaul staff, adopt a strong information technology system in all areas of banking activities, ensure strict reporting systems and ensure that fraudsters are prosecuted to serve as deterrents.”

 

 

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Ogbomoso pupils, teachers rescue a big relief to Nigeria – Tinubu

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President Bola Tinubu on Friday evening said the rescue of the abducted pupils and teachers from schools in Oriire LGA of Oyo state has brought relief to the entire nation.

The president’s special adviser on information and strategy, Bayo Onanuga, said in a statement that Tinubu “expressed profound joy” over the successful rescue of the victims.

Onanuga said the president commended the military, the Department of State Services (DSS), and the police “for working round the clock in the last 56 days to secure the release of the abducted children and their teachers without any collateral damage and for arresting eight of the abductors and neutralising others.”

Onanuga said Tinubu also expressed regret over the suffering endured by the children, their teachers, their families, and the nation since the abduction.

The president praised the Oyo state government for working closely with the federal government throughout the rescue operation and urged the state to strengthen security around schools.

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“I am profoundly happy that our security forces successfully rescued the abducted pupils and teachers from Orire, Ogbomoso in Oyo State today after a military, police and intelligence-driven operation that neutralised some of the terrorists that perpetrated the evil act and the arrest of eight of them,” the statement reads.

“This successful military operation has ended the siege and standoff of over 50 days and has brought relief to the entire nation and the affected families in particular. 

“On behalf of the country, I express my gratitude to the officers and men of our armed forces, the intelligence agencies and the police for the safe rescue of the children and their teachers.

“My government will get justice for these children and their teachers and for the family of Mr Oyedokun, who the terrorists gruesomely murdered.

“I must commend the government of Oyo State for working cooperatively with us in bringing this unfortunate incident to a successful end.”

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The president also directed emergency agencies to work with the Oyo state government to provide the rescued children and teachers with all necessary medical care and relief support.

According to reports, the pupils and their teachers were rescued during a joint operation involving personnel of the Nigerian Army and the police, backed by intelligence from the DSS.

A security source said at least nine of the bandits were killed during the operation, while eight were arrested and are in the custody of the DSS.

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Makinde thanks Tinubu over rescue of abducted Ogbomoso pupils, teachers, says it’s a big relief

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Governor Seyi Makinde of Oyo state has said that he is overjoyed following the rescue of pupils and teachers abducted in Oriire LGA of the state.

The victims regained their freedom on Friday after spending 56 days in captivity, following a coordinated operation involving the military, the Department of State Services (DSS) and the police.

Speaking with Channels Television shortly after the rescue, Makinde described the development as a huge relief for the state.

He thanked President Bola Tinubu for pushing for their release.

“It is such a big relief for all of us. Just right now, I am overjoyed and can hardly say much,” the governor said.

“I use this opportunity to say a big thank you to all the service commands, the police, DSS, military and, of course, the president for pushing for their release.”

On May 15, gunmen attacked Baptist Nursery and Primary School, Yawota; Community Grammar School, Esiele; and LA Primary School in Ogbomoso, all in Oriire LGA.

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The sad incident prompted the Oyo state government to shut schools in four LGAs as security agencies intensified rescue efforts.

Protests were organised in some parts of the country to demand the rescue of the abducted schoolchildren.

On May 18, Makinde said one of the teachers abducted during the attack was killed in captivity.

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Eight kidnappers arrested, others killed – Presidency

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Following the heart-warming news of the rescue of the pupils and teachers abducted in Orire Local Government Area of Oyo State, the Presidency has confirmed that eight of the kidnappers have been arrested and are now in the custody of the Department of State Services, while some others were neutralised during the operation.

Bayo Onanuga, special adviser to the president on information and strategy, disclosed this in a follow-up post on his verified X handle on Friday after he announced the victims’ release.

Onanuga said no concession was made to the terrorists to secure the freedom of the abducted pupils and teachers.

Onanuga explained that the kingpin whose release the kidnappers had demanded was neither freed nor spared, as he remains under prosecution for offences linked to his terrorist activities.

He wrote, “Updated: in the course of the rescue operation, eight of the kidnappers were arrested and are now in DSS custody, while some of them were neutralised.

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“There was no quid pro quo in the rescue as one of the terrorists, a kingpin, that the kidnappers demanded his release, is being prosecuted for his atrocities. The security agencies will give full account soon.”

He added that security agencies would soon provide a comprehensive account of the operation.

The pupils and teachers had spent weeks in captivity after gunmen stormed three schools in the Esiele and Yawota communities of the local government area on May 15, killing a teacher and later beheading another in a video that sparked national outrage.

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