A recent report by the Financial Institutions Training Centre (FITC) has revealed that Nigerians lost a staggering ₦42 billion to fraud involving point-of-sale (POS) systems and mobile phones between April and June 2024.
The report, which covers the second quarter of 2024, indicates that fraudulent activities related to computers, mobile devices, and POS systems were the most common. During this period, there were a total of 11,532 reported fraud cases.
The total amount of fraud for the second quarter reached ₦56.3 billion, a notable increase from the ₦34.8 billion reported in the first quarter of the year. Of this amount, ₦42.6 billion was successfully stolen by fraudsters, while financial institutions managed to recover ₦13.7 billion.
Mobile fraud, which includes scams via mobile apps and internet banking, was the most prevalent, accounting for 33.4% of the cases. POS-related fraud followed closely with 24.6%, and web-based fraud represented 16.9% of the total incidents.
The report highlights a growing concern over computer-based fraud, reflecting the increasing threat from cybercriminals in Nigeria’s financial sector. It also notes that bank branches experienced the majority of the losses, with 95% of the total fraud value occurring at the branch level.
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Despite technological advancements, fraud continued to be a significant issue, with both external actors and insiders involved. The report revealed that 49 employees were dismissed for their involvement in fraudulent activities during the quarter.
In terms of financial impact, bank branches suffered the most, with losses amounting to approximately ₦54 billion, or 95.63% of the total fraud value. Web-based fraud caused losses of ₦1.2 billion (2%), while POS and mobile fraud each accounted for around 1%, with losses of ₦651 million and ₦547 million, respectively.
Interestingly, card-related fraud saw a 31.8% decline, but there was a significant increase in cheque and cash fraud, indicating that criminals are exploiting traditional financial tools as well.
FITC stressed the importance of adopting advanced technology, such as artificial intelligence, to combat the growing complexity of fraud. The report calls for stronger security measures and continuous staff training to address these challenges.
As fraudsters exploit both modern and traditional methods to target financial institutions, the FITC emphasized the need for stricter regulatory oversight and the use of cutting-edge technology to safeguard the financial sector.
