Banks Sack 110 Top Executives, Others Over N82bn Fraud

At least 110 top bank executives and junior staff members have been sacked for fraud-related cases in the past two years, findings by The PUNCH have shown.

These were contained in the ‘Reports of Fraud and Forgeries in Nigerian Banks’’ released by the Financial Institutions Training Centre between the second quarter of 2021 and Q2 2023.

FITC’s institutional members are members of the Nigerian Banker’s Committee, which comprises the Central Bank of Nigeria, the Nigeria Deposit Insurance Corporation, and all licensed banks in Nigeria.

A breakdown showed that while only four bank officials were sacked in Q2 2021, the figure rose by 175 per cent to 11 in Q2 2023.

The highest number of sacked top bank executives and junior staff members was recorded in Q3 2022. Twenty officials were fired.

The PUNCH observed that between Q2 2021 and Q2 2022, 52 bank staff members were sacked for fraud-related issues.

However, between Q3 2022 and Q2 2023, 58 bank staff members were sacked for the same reason.

Also, within the period under review, the sacked staff members were involved in a total of 967 fraud cases.

The highest number of cases was recorded in Q4 2021, with 410 cases involving bank staff, while the lowest was recorded in Q3 2021, with 32 cases.

The PUNCH further observed that between Q2 2021 and Q2 2022, bank staff were involved in 657 cases, while between Q3 2022 and Q2 2023, they were involved in 310 cases.

Also, about N18.01bn was lost due to fraud committed by bank staff and outsiders within the reviewed period out of a total of N81.69bn involved in fraud cases.

The PUNCH learnt that the highest amount lost was N5.79bn in Q2 2023, while the lowest amount lost was N472.28m in Q1 2023.

For the total amount involved, the highest amount was N34.78bn in Q3 2021, while the lowest amount was N1.18bn in Q2 2022.

The PUNCH further observed that mobile fraud, computer/web fraud, and P0S-related fraud were the most prevalent types of fraud, and this trend persisted in Q2 2023.

In June 2022, the PUNCH reported the continued trial of three former workers with the First Bank of Nigeria facing attempted fraud charges before a Lagos State Special Offences Court, Ikeja.

The defendants, Ozioma Ugorji, 35; Ugwu Emeka, 32; and Obike Chukwuka, 38, were arraigned by the Economic and Financial Crime Commission for allegedly attempting to steal N20bn from the bank.

The PUNCH learnt that the defendants conspired to tap into the bank’s server to grant access to a syndicate.

They were, however, apprehended by the EFCC on March 6, 2021, following an intelligence report.

In June this year, four men were arraigned at the Yaba Magistrates’ Court for allegedly defrauding their employer, Think Finance Microfinance Bank of N150m in the FESTAC Town area of Lagos State.

The defendants include the company’s Head of Risk Management, Ojimi Ayodeji, the Loan Officer, Isaac Eddy, Joseph Setonji and Juwon Irinyemi, and were arraigned before Magistrate Patrick Nwaka on three counts of theft.

The PUNCH had reported recently that four Nigerian deposit money banks lost a total of N1.77bn to fraudulent activities involving the banks’ employees and consumers in 2021.

This was contained in the 2021 financial statements of the banks, which included Access Bank Plc, Guaranty Trust Bank Plc, First Monument City Bank, and Wema Bank.

The PUNCH also reported that Access Bank, GTB and Fidelity Bank recorded 26,877 fraud cases in the first six months of this year, according to analyses of their financial reports for the first half of 2022.

This was a 56.45 per cent decrease from the 61,715 fraud cases that were recorded by the banks between June and December, 2021.

The President of the Bank Customers Association of Nigeria, Dr Uju Ogunbunka, recently urged banks to educate their staff and create protective measures that would discourage fraud.

Commenting, ICT expert and Senior Partner of e86 Limited, Olugbenga Odeyemi, recently said several fraud cases needed insiders from banks.

He stated, “Some of the hacking and fraud cases that we’ve seen, happened not because of the lack of security on the banks’ electronic platforms, but because of poverty, greed, and sometimes the lack of education on the part of the customers.

“Other than asking banks to invest more in the security of their platforms, it’s equally important that banks spend more resources on educating their customers.

“That said, several fraud cases couldn’t have happened without the help of insiders in some of the banks. I think Nigerian banks should spend more money on the welfare of their staff while making appropriate changes to their internal processes, starting from their hiring processes.”

The Chief Executive Officer of the Centre for the Promotion of Private Enterprise, Dr Muda Yusuf, recently urged the CBN to introduce sanctions and eliminate policies that promote corruption.

He said, “I think what they can do is to activate sanctions on anyone found wanting. Aside from the tracking, there must be evidence. And once there is evidence, they should close in on anyone they find. Cyber fraud is the biggest threat in the banking industry.’’

The FITC advised banks to strengthen their security protocols and utilise advanced fraud detection systems.

It said, “Considering the rise in the total amount involved in fraud cases and the amount lost, Nigerian banks should strengthen their security protocols and systems to prevent unauthorised access to customer accounts and sensitive information. This may involve incorporating measures such as multi-factor authentication, implementing strong encryption techniques, and ensuring regular security updates are in place.