How Bank Managers, Supervisors Steal Customers’ N15.15bn – Officials

The Nigeria Deposit Insurance Corporation has said that bank managers and supervisors were involved in no fewer than 119 fraud and forgery cases in banks which led to the loss of N15.15bn in 2018.

It also said that the number of temporary staff involved in fraud and forgery cases had consistently been on the increase.

It therefore called on deposit money banks and regulators 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.

According to Sunday Punch, the NDIC in its 2018 annual report released during the week noted that a total of 899 bank workers were involved in frauds and forgery cases in 2018 compared with the 320 reported in 2017.

It noted that 37,817 fraud cases were reported in 2018 against the 26,182 in 2017, adding that the amount involved stood at N38.93bn in 2018 compared to N12.01bn in 2017.

The report, however, showed that the actual amount lost to fraud incidences in 2018 stood at N15.15bn as against the N2.37bn and N2.40bn in 2017 and 2016 respectively.

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The NDIC report partly read, “The rising fraud incidences could be attributed to the increase in the sophistication of fraud related techniques such as hacking and cybercrime as well as 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 the Internet and technology-based sources of fraud had the highest frequency, accounting for 59.2 per cent of fraud cases and 42.83 per cent of the actual total loss suffered.

“A total of 899 staff were involved in frauds and forgery cases in 2018 compared with 320 in 2017. The number of temporary staff involved in fraud was 394, accounting for 43.83 per cent of the total number of staff involved in frauds. This was followed by Officers and Executive Assistants’ cadre with 206 or 22.91 per cent. Supervisors and managers accounted for 119 or 13.24 per cent of the total fraud cases. Banks should strengthen their internal controls.”

Giving its assessment of the overall condition of the Nigerian banking system, the NDIC said the banking industry had witnessed noticeable level of improvement in most indicators of financial sector soundness, reflecting the salutary macroeconomic stability achieved in 2018.

It, however, added that the financial condition of the microfinance banks and primary mortgage banks subsector of the system “remained susceptible to vulnerabilities”.

On the resolution and management of failed insured financial institutions in the previous year, the NDIC said it “effectively” closed 138 microfinance banks and five primary mortgage banks whose licences were revoked by the Central Bank of Nigeria between October and December, 2018.

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