By Aaior K. Comfort
Fraud involving computer systems, mobile devices, and point-of-sale (POS) systems dominated fraudulent activities in Nigeria during the second quarter of 2024, according to a recent report by the Financial Institutions Training Centre (FITC).
The report, detailing 11,532 fraud cases, highlighted that computer/web fraud, mobile fraud, and POS-related fraud were the most prevalent types, continuing a trend observed throughout 2023 and the early part of 2024.
In the second quarter, the total value of reported fraud rose to N56.3 billion, up from N34.8 billion in the first quarter of the year. Of this amount, N42.6 billion was lost to fraudsters, while N13.7 billion was recovered by financial institutions.
Mobile fraud, which includes fraud through mobile apps and internet banking, accounted for 33.4% of the cases. POS-related fraud followed closely at 24.6%, with web-based fraud contributing 16.9% of the total cases.
The report also emphasized the significant losses incurred by bank branches, which suffered 95% of the total fraud value. Despite technological advances, both insider and outsider threats remain prevalent, with staff involvement in fraud increasing. During the quarter, 49 employees were dismissed for their roles in fraudulent activities.
A breakdown of fraud categories revealed that bank branches experienced the highest impact, with losses amounting to approximately N54 billion, or 95.63% of the total fraud amount. Web-based fraud accounted for N1.2 billion (2%), while POS and mobile fraud each contributed about 1%, with N651 million and N547 million respectively.
The FITC report noted a shift in fraud tactics, with a significant 31.8% decrease in card-related fraud cases. Conversely, cheque and cash fraud cases surged, highlighting the continued exploitation of traditional financial instruments by fraudsters.
The FITC emphasized the need for enhanced security measures and advanced technology to combat the evolving sophistication of fraud. It stressed the importance of proactive steps, including improved security systems and ongoing staff training, to address these challenges effectively.
The report underscores the ongoing struggle within Nigeria’s financial sector to protect against fraud, with both new and traditional methods being exploited by fraudsters. It calls for stricter regulatory oversight and the adoption of cutting-edge technology to safeguard the financial landscape from future threats.