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The Central Bank of Nigeria ( CBN) is in the forefront and in collaboration with other regulatory institutions to curb bank frauds and the results are manifest.
Fraud losses fell to N25.85 billion from N52.26 billion in 2025, representing a 51 percent drop. Also reported cases dropped to 67, 518 from 70, 111, representing a 4 percent drop in the same period.
The drops were attributed to stronger collaborations among regulators and security agents, tighter controls and improved fraud control capabilities.
CBN is in the forefront and providing the regulatory leadership, policy support and necessary coordination needed to achieve the target objectives.
The dangers of Bank frauds cannot be over-emphasised. CBN Deputy Governor, Financial System Stability, Mr Phillip Ikeazor had noted that bank frauds threaten financial system stability, financial inclusion, masses oriented concept and a key tool to poverty alleviation, trust in digital finance and poses systemic risks.
Mr Ikeazor who spoke at the recent 2026 Nigeria Electronic Fraud Forum( NeFF), with the theme, Shrinking Fraud Losses With The ISO 20022 And Identity Management, noted the need for the banking industry to adopt a more holistic, data- driven fraud management system that could deliver tangible results rather than fragmented controls.
According to Mr Ikeazor, “by strengthening fraud controls, Nigeria safeguards confidence in its payments system, supports economic growth and reinforces macro-financial stability.
Some typical bank frauds include loans fraud, overstating interest charges, counterfeited securities, money transfer fraud, money laundering fraud, manipulation of dormant accounts.
Others include insider compromise, online fraud, SIM- Swap abuse and social engineering which has been noted as a primary threat with more than 80, 000 customers affected in 2023.
Social engineering is where fraudsters manipulate people to reveal confidential information. They use fear or greed, requests for personal details, baiting, luring victims with tempting offers, romance scams which builds fake relationships to gain trust and money etc.
Some of the causes of bank frauds include, volume of work whereby the workload done by officials could be so heavy that frauds could pass u detected, banking experience of staff, whereby fraud occurs with higher frequency among staff with little experience.
Others include poor management, nature of services, whereby documents of value are exposed to undisciplined staff and poor security arrangements whereby security for valuable documents are weak, poor and vulnerable, thus making it easy for fraudsters to have their ways undetected.
CBN wants institutions to ensure a rapid response to suspicious transactions within 30 minutes under the structure of the Nigerian Electronic Fraud Forum( NeFF)
Mr Ikeazor noted that reducing fraud response time to under 30 minutes was critical for improved recovery outcomes..
He called for a full exploitation of the ISO 20022 data, universal and real- time identity verification, enhanced 24/7 fraud monitoring and response, structured liability sharing and consumer reimburse frameworks
The deputy governor further noted the role of identity infrastructure in limiting fraud and emphasised the impact of the Bank Verification Number( BVN) and its integration with the National Identification Number( NIN) in reducing impersonation and identity fraud.
In 2013, CBN signed a contract with Dermalog for biometrics and which was necessitated by identity frauds in banks and other financial institutions.
Biometrics are tools for online and mobile banking which offer unique customer identification system that gives unchangeable identification that helps in KYC( know your customer). It uses one’s unique physical feature to make sure you are you.
CBN started the implementation of the BVN in 2014 to enhance security and it utilises finger prints and facial recognition and links customers biometrics to all banks.
The linkage of the BVN to the National Identification Number( NIN) has been noted to be revolutionary and transformational, and reportedly, it has reduced impersonation based fraud significantly and offers a more secure banking.
Nwobu, a Chartered Stockbroker and Business Journalist wrote via arizenwobu@yahoo.com Tel 08033021230.
