Say most bank frauds are traced to insiders
By Chika Amanze-Nwachuku
The Force Criminal Investigations Department has launched a big manhunt for bank frauds syndicates that collude with bank employees to steal huge amounts of money from customers’ accounts.
Authoritative police sources hinted at the weekend that commercial banks in Nigeria might have lost as much as N35 billion to these fraudulent activities in the last four years.
A 2018 fraud report by the Nigeria Electronic Fraud Forum (NeFF) showed that over 17,600 bank customers lost N1.9 billion to fraudsters between 2018 and May this year.
Nigerian banks have lost a total of N199 billion to e-fraud between 2,000 and 2014, mostly due to inappropriate and reckless management of customers’ data, according to latest estimates.
According to the sources, the growing list of bank customers who have lost huge sums through fraudulent means sometimes with the aid of some workers in the banks, had become a source of huge concerns to both top management of banks and police authorities, prompting a massive manhunt for the criminals.
A top cop revealed that the manhunt might not also be unconnected with a recent revelation by the United States’ Federal Bureau of Investigation (FBI) that majority of fraudsters behind a variety of scams and online fraud cases in the US were based in Nigeria.
He also said a recent fraudulent withdrawal of N1million from an account that belongs to a military personnel domiciled in a bank (name withheld) might have also triggered the manhunt.
It was gathered that a bank customer had received one time password (OTP) notification on her registered mobile number and promptly notified the bank of the suspected phoney transaction.
Despite the prompt notification and her compliance with the bank directive to change her password, the criminals still succeeded in stealing N1million from her account domiciled with the Oshodi branch of the said bank.
A bank source said that the money was transferred at about 1am on that fateful day to an account in another bank, from where it was immediately moved to another account domiciled in a 3rd bank.
The police, according the source are working on a story that these syndicates have their collaborators in banks, adding that they would be fished out in the course of investigation.
“Although these banks don’t like to report in- house fraudulent activities for fear that the information will get to the press, the information we received in this regard was that the customer informed the bank immediately she received the OTP alert. Our concern was that the criminals still had their way notwithstanding that the bank was notified. She received a debit alert on her phone that she had been debited N1,000,000. We will widen the scope of our investigation to know whether it was an insider job”
On whether the bank authorities have officially reported the matter to the police, he said “the police have the duty to investigate criminal activities, whether officially reported or not”
A source close to the bank confirmed the incident but ruled out involvement of the bank staff. He said the bank had promised to resolve the matter with the customer and will conduct a thorough investigation to ascertain how the fraudulent transaction was carried out.
Shedding more lights on the criminals’ modus operandi, a top police at the FCID said in some cases, these fraudsters gain access to victim’s mobile number by obtaining duplicate SIM card from telecom service providers. Once the SIM card replacement was done, the old SIM becomes inactive and the fraudster will then use the OPTs sent by the bank to steal money from the customer’s account.
Reacting to the increasing rate of in-house bank frauds, a top official of one of the big banks said: “It is practically impossible to fraudulently withdraw money from an online account unless the customer compromises personal details inadvertently or otherwise. He added: This is because a beneficiary for fund transfers requires two factor authentication- log in ID, and password and OTP sent to the customer’s registered mobile number.
A recent report of the off-site supervision of Deposit Money Banks by the Nigeria Deposit Insurance Corporation (NDIC) showed that Nigerian banks lost a whopping N12.01billion in 2017 alone to fraud cases that resulted from internal collaboration by banks staff.
The report, which was based on the 286 responses received from 26 banks, resulted in the sack of 320 bank employees, whose appointments were either terminated or summarily dismissed.
According to the NDIC, apart from internet/online banking and ATM card related fraud types, which constituted about 92.68 per cent of all the reported (26,182) cases, other reported crimes perpetrated by these fraudulent bank staff were fraudulent transfers/withdrawals, cash suppression, unauthorised credits, fraudulent conversion of cheques, diversion of customer deposits, diversion of bank charges and presentation of forged or stolen cheques.
The United States’ Federal Bureau of Investigation (FBI) said on Thursday that it had arraigned scores of suspected fraudsters behind a variety of scams and online fraud cases.
The U.S. Attorney General, Nick Hanna, said during a press conference that majority of the suspects were based in Nigeria in what is believed to be one of the largest cases of online fraud in American history.
.
