Banking Sector Contributes to 70% of Financial Crimes in Nigeria

The banking sector in Nigeria is grappling with a significant challenge as an estimated 70% of financial crimes in the country can be traced back to this vital industry. The surge in fraudulent activities within the banking sector has become a matter of serious concern for the Economic and Financial Crimes Commission (EFCC).

Ola Olukayode, the Chairman of EFCC, raised the alarm about the increasing prevalence of financial crimes during the 2023 Annual Retreat and General Meeting of the Association of Chief Audit Executives of Banks in Nigeria (ACAEBIN). Speaking at the event, Olukayode, represented by Idowu Apejoye, the Director of Internal Audit at EFCC, emphasized the crucial role of Chief Audit Executives in tackling fraud within the banking sector.

Olukayode highlighted the dual nature of banking fraud in Nigeria, involving both insider and outsider elements. Insider-related fraud encompasses outright theft of customers’ deposits, unauthorized loan facilities, forgery, and various other criminal practices. Additionally, he expressed concern about collaboration between insiders and outsiders in committing fraud.

The EFCC Chairman disclosed that an alarming 70% of financial crimes in Nigeria can be traced to the banking sector, labeling this scenario as both disturbing and unacceptable. To address these challenges, Olukayode urged ACAEBIN to ensure proper monthly reconciliation of accounts in accordance with accounting requirements.

He further tasked the association with actively monitoring the financial activities of banks, conducting regular comparisons between actual and budgeted revenue and expenses, and implementing periodic reviews and checks. These measures, according to Olukayode, are essential to curb fraudulent activities within the banking sector.

Prince Akamadu, the Chairman of ACAEBIN, expressed the association’s commitment to implementing the recommendations provided by the EFCC Chairman. He reiterated the association’s dedication to addressing the foreign exchange challenges in Nigeria, emphasizing it as a key objective of the retreat. The collaboration between regulatory bodies and industry stakeholders remains crucial to fostering a secure and transparent banking environment in Nigeria.