Cyberfrauds: Nigerian consumers lost N42bn to PoS, mobile apps and Internet banking Q2 2024 ─Report

*The Financial Institutions Training Centre, in Lagos, in a new industry report, highlights a rising wave of cyberfrauds via mobile apps and Internet banking platforms that has cost Nigerian consumers of financial products and services whopping N42 billion between April and June 2024 in the ecosystem

Isola Moses | ConsumerConnect

Citing most of the losses occurred at the bank branch level, the Financial Institutions Training Centre (FITC), Lagos, in a new industry report has highlighted a rising wave of fraud that cost Nigerian consumers of financial products and services whopping N42 billion between April and June 2024.

ConsumerConnect reports the FITC provides innovative knowledge solutions and capacity-building programmes that develop and strengthen individuals and organisations through Learning and Development, Advisory, as well as Insights and Policy Advocacy services.

The Centre’s institutional members are members of the Nigerian Bankers’ Committee, comprising the Central Bank of Nigeria (CBN), Nigeria Deposit Insurance Corporation (NDIC), and all licensed banks in the West African country.

The FITC Second Quarter (Q2) Report of 2024 also indicated how cyberfraudsters targeted Point of Sale (PoS) systems and mobile devices with fraudulent activities involving these technologies reaching alarming levels within the period.

According to the Centre, there were 11,532 cases of fraud with a total value of N56.3 billion, indicating marked increase from N34.8 billion in the First Quarter of this year.

The FITC also reported that N42.6 billion of the total value was ‘successfully’ stolen, while the country’s banks and Other Financial Institutions (OFIs) successfully recovered N13.7 billion.

Mobile frauds most prevalent, says FITC

The report further showed mobile fraud was the most prevalent, as it was found to be responsible for 33.4 percent of the reported incidents, followed by PoS-related fraud, estimated at 24.6 percent.

The organisation revealed that these forms of fraud also include scams perpetrated through mobile apps and Internet banking platforms.

It said the Web-based fraud accounted for 16.9 percent of the cases, underlining the growing sophistication of cybercriminals.

Most of the losses occurred at the bank branch level, whereas 95 percent of the total fraud value, approximately N54 billion, was recorded, according to FITC report.

The Centre averred the development signalled a troubling increase in “insider involvement”, with 49 employees dismissed for their role in these schemes during the quarter under consideration.

Banks, OFIs urged to adopt more sophisticated tools

The FITC industry report indicated that cybercriminals have continued to exploit weaknesses in both conventional and modern systems despite recent advancements in cybersecurity.

The Centre explained as card-related fraud declined by 31.8 percent, there was a remarkable surge in cheque and cash frauds, a development which underscores the adaptability of criminals in Nigeria’s financial sector.

The report, therefore, urged Nigerian banks and Other Financial Institutions to adopt more sophisticated tools like Artificial Intelligence (AI) to combat the increasingly complex fraud schemes in the country’s banking and financial ecosystem.

As the industry stakeholders explore further robust, innovative responses to protect consumers and institutions alike, the FITC report equally recommended tougher regulatory oversight, continuous employee training, and enhanced security protocols as crucial steps in safeguarding the sector.

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