The Economic and Financial Crimes Commission, EFCC, has urged banks to ensure they employ staff based on integrity rather than on high business targets so as to reduce the number of fraud cases in the banking sector and prevent fraudsters from getting into the banking system.

This was disclosed by Ibrahim Shazali, of the Bank Fraud Section of the Economic and Financial Crimes Commission (EFCC), who noted that fraudsters had gained access into the financial system as banks emphasised more on deposit mobilisation for staff.

Making this known at a three day workshop organized by the Nigerian Deposit Insurance Corporation (NDIC) for
finance journalists in Ilorin, Kwara State, he categorically challenged banks to ensure that they conduct thorough integrity background checks on individuals before they are employed.

Shazali noted that the level of fraud in the financial industry would have been higher if the Nigerian Communications Commission (NCC) and telecommunication companies had not embarked on the SIM card registration process.

Speaking about insider fraud, he said while the volume may be lower, the impact is always higher than outsider
fraud. With the number of reported fraud cases rising by 50 per cent from 822 in 2013 to 1,461 in 2014, he described the level of apprehension in suspected cases as pitiful.

According to him, only 41 or three per cent of the 1,461 cases were apprehended. He noted that the U.S. Federal Bureau of Investigations employs over 600 forensic accountants, saying that “Nigeria is still far behind with regard to understanding the role and necessity of forensic auditing.

“One of the easiest and most logical places to begin this arduous journey is to invest in the increased preemptive monitoring and investigation of electronic transactions through more sophisticated means of accounting such as those practised by forensic auditors,” he said.

While noting that Nigerian accountants do not have the necessary skills required to perform forensic auditing duties, he stressed that, “This is highly disturbing as the role of forensic accountants is integral to the success of the war against bank fraud.”

Shazali furthered disclosed that although there is the Cyber Crime Act, lack of adequate legislative support,
poor corporate governance and underdeveloped IT infrastructure serve as a deterrent to successful investigation of electronic transactions.