How Nigerian Bank Customers Lost N1 Billion to Scams Via ATM, PoS, Cards, and More in Three Months
Nigeria’s banking sector is wrestling with a large problem of scams and forgeries, leading to major losses for customers.
In the initial three months of 2023, these fraudulent activities caused significant financial damages.
The Nigerian Deposit Insurance Corporation (NDIC) voiced its worries about the rise in scam cases.
The Financial Institute Training Centre (FITC) recently revealed a report titled “Reports on Scams and Forgeries in Nigerian Banks,” explaining this worrying issue in detail.
Scams and Forgeries in the First Quarter of 2023
During the first three months of 2023, nearly N1 billion was lost to scams and forgeries through multiple transaction methods.
These fraudulent activities targeted ATMs, cards, mobile banking apps, PoS terminals, cheques, and more.
Reduction in Scam Cases
Even though the losses were huge, there was a piece of positive news: the total number of reported scam cases across all transaction methods went down.
The number of fraud cases related to cash, cards, and cheques saw big drops. This shows that some progress is being made to fight these illegal activities.
Losses from Card and Cash Scams
When we look at the losses from various types of scams, we see interesting patterns.
For example, card fraud went down a lot, by 90.21% from the previous three months. But, cash fraud went up by 35.89%.
Scams via ATM, Web, Mobile, and PoS
When we look at the losses from different payment methods, we see that there was a big increase in scams via ATM and bank branch channels. On the other hand, scams on the web went down by a huge 95.38%, and there were also decreases in scams on mobile and PoS channels.
Bank Employees and Scams
The first three months of 2023 showed a troubling trend: bank employees getting involved in scams. This saw a big increase of 89.47%. Banks responded strongly by ending the jobs of some of the employees involved.
Cyber Attack on Globus Bank
Globus Bank Limited suffered a major loss when cybercriminals found a weakness in the system and took out N1.755 billion from customers’ accounts. Even though some of the money was gotten back, a large amount that was moved to other commercial bank accounts could not be reclaimed.
Conclusion
The ongoing problem of scams and forgeries in Nigeria’s banking sector is a big challenge to the trust of customers and the overall financial stability.
Although there has been some progress in reducing the number of scam cases and outsider involvement, the growing participation of bank employees in these activities needs urgent attention and action from authorities and banks.
Measures to prevent scams and better cybersecurity rules are vital to protect customers’ money and to keep the banking system safe.