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The Nigeria Deposit Insurance Corporation (NDIC) has called on law enforcement agencies to strengthen their collaboration to curb banking fraud in the country.
Bello Hassan, Managing Director/Chief Executive of the NDIC, emphasized this need at the annual capacity-building workshop for law enforcement agents in Lagos. Represented by Bashir Nuhu, NDIC’s Director of Communication & Public Affairs, Hassan stated, “We are aware of the challenges in investigating and prosecuting financial malpractices and bank fraud cases. We urge you to persist in your efforts, and rest assured of our unwavering support.”
He highlighted the rapidly evolving banking system driven by financial technology innovations, which presents new challenges. “Criminally minded users, including cybercriminals, are constantly refining their tactics. Workshops like this are essential for law enforcement officers to stay informed about the dynamic operating environment and prevalent types of fraud,” Hassan said.
Hassan also noted that measures implemented by regulatory and supervisory agencies are beginning to yield positive results. “Authorities are becoming more proactive with policies and investigations to ensure that banks and financial institutions enhance their risk management practices, thereby preventing loss of funds and maintaining depositors’ confidence.”
The advancements in information technology, while opening new possibilities in banking operations, have also exposed the sector to emerging threats. This situation increases the burden on regulators and supervisors to enhance their operational capacities and underscores the need for more collaboration between agencies involved in combating banking malpractice.
Henry Fomah, Head of the NDIC Legal Department, echoed the call for improved collaboration to fight financial crimes, particularly insider fraud. “The NDIC has been at the forefront of investigating and prosecuting those culpable in bank failures. We are committed to building the capacity of law enforcement agencies and collaborating to achieve timely and effective results against financial malpractices,” Fomah stated.
Representing the Executive Chairman of the Economic and Financial Crimes Commission, Olanipekun Olukoyede, the Commander of the EFCC Lagos Zonal Command, Michael Wetkas, highlighted the alarming rise of insider fraud. “In 2022, some bank staff colluded to illegally increase withdrawal limits of targeted accounts, resulting in millions of naira in losses. The lax regulation of fintechs also creates fertile ground for fraud. While reactive measures are important, prevention is crucial,” Wetkas noted.
The Financial Institutions Training Centre’s fraud and forgeries report for Q1 2024 revealed that commercial banks sacked 35 employees over fraud between January and March.
Assistant Inspector General of Police Romokere Ibani, in charge of the FCID Annex in Lagos, urged workshop participants to collaborate for the stability of the banking sector. “We need to be more sceptical and circumspect about our financial dealings with banks. All agencies present here must work together to protect our banking system,” he said.
The NDIC recently organized a workshop for judicial workers in Lagos, reinforcing its commitment to combating banking fraud through education and collaboration.
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