FRAUD, FORGERIES DOWN BY 76.6% IN BANKS

New risk management practices recently introduced by the Central Bank of Nigeria (CBN) seem to be yielding better dividends to operators and regulators, as records on fraud and forgeries' cases contained in the 2011 half year report indicate an impressive 76.6 per cent reduction when compared with the corresponding period of 2010.

Details of fraud and forgery cases contained in the apex bank's half year report released early this year, show that a total of 1,393 cases of attempted or successful fraud and forgery involving the sum of N6.5 billion were recorded in the entire banking industry during the period under review.

According to the report, about 410 cases out of the whole figures reported were successful and resulted in a loss of N1.95 billion to the banks, compared with 5,960 reported cases of fraud and forgery, involving N11.6 billion with actual loss of N8.0 billion in the second half of 2010.

Giving reasons for the massive reduction, the banking sector regulators attributed the development to improvement in banking sector's risk management strategies and procedures which are known to have improved significantly since the implementation of the banking sector reform programme in 2009.

It would be recalled that the apex bank had as part of efforts to check the excesses of bank chiefs, issued new risk management guidelines, which all banks must implement under the new banking dispensation.

Meanwhile, the CBN report also indicated that only 116 ATM-related cases valued at N17.2 million were reported in the first half of 2011, in contrast to 411 cases amounting to N82.2 million recorded in the second half of 2010.

The reduction in reported ATM scam cases according to sources may not be unconnected with the massive enlightenment mounted by the Central Bank of Nigeria, the banks and the electronic payment services providers warning depositors against the schemes of the fraudsters.

It would be recalled that several deposit money banks had as part of customers service information advised account holders on regular intervals to ensure that their account details are not compromised to avoid access by unauthorized persons. This piece of information package was further complemented by the installation of ATMs with improved facilities to guarantee more security to customers.

Expectations are, however, high that the impending implementation of cashless economy by the apex bank will further enhance the security of banking transactions across the country. The Central Bank of Nigeria in collaboration with the Bankers Committee intends to deploy additional 40, 000 new PoS in Lagos area alone as the pilot phase begins in January 2012 to ensure seamless execution of the programme.