Government Agency Says 70% Of Financial Crimes Involve Banks

Government agency Economic and Financial Crimes Commission (EFCC) revealed on Monday that 70% of the nation's financial crimes is traceable to the banking sector and urged relevant authorities and professionals, especially bank auditors, to be more vigilant in tackling financial crimes.

Speaking in Abuja at the 2023 Annual Retreat and General Meeting of the Association of Chief Audit Executives of Banks in Nigeria, EFCC's Chairman Ola Olukayode pointed out that banks are becoming a part of financial criminal activities, which has increased challenges for the commission.

Olukayode, represented by the Internal Audit Director of EFCC Idowu Apejoye, noted that there is a need to prevent and tackle issues of such fraudulent practices in the banking sector.

"Broadly speaking, banking fraud in Nigeria is both inside and outside related. The inside related fraud comprises outright selling of customers' deposits, authorizing loan facilities, forgery and several other kinds of unhealthy and criminal practices," he said, Punch reported.

He added, "The outsider-related ones include hacking, ATM fraud, and conspiracy among others. And then the absurd one is when both collaborate, that is a collaboration among the bankers and the outsider."

Apejoye explained that these outside-related frauds are "really absurd" because when something like this happens, it shows that the official involved is selling out the system. He shared an estimation that around banks are involved in 70% of such financial crimes in Nigeria, stressing that it is "disturbing and unacceptable."

Meanwhile, Olukayode emphasized that ACAEBIN's (Association of Chief Audit Executives of Banks in Nigeria) should ensure monthly account reconciliation and urged monitoring of bank activities, comparing revenue and expenses, and conducting regular reviews to curb irregularities.

ACAEBIN Chairman Prince Akamadu welcomed the suggestion and said the association will work together on the recommendations, adding that ACAEBIN is committed to solving the foreign exchange challenges too.

"That is part of the reason why we are having this retreat, to ask ourselves, to do an introspection and ask ourselves, given our position in the banking industry, or the executives of banks in Nigeria, are we doing enough?" Akamadu said.

The chairman noted that by the end of this retreat, they will come up with a communique, hoping to address some of the issues, one way or the other, that will address the role of banks in FX challenges in this industry.