Complaints over banking fraud, ‘aggressive’ charges, others hit 1,612

Despite public outcry, the spate of inexplicable charges associated with banking in the country remain on the upswing, as a total of 1,612 complaints from consumers of financial services were received between July and December 2018.

The figure, which showed an increase of 173 complaints or 12.02 per cent over the 1,439 received in the first half of 2018, was contained in the Financial Stability Report of the Central Bank of Nigeria (CBN).

Of the total complaints, 1,602 or 99.38 per cent were against commercial banks, while 10 complaints or 0.62 per cent were against Other Financial Institutions (OFIs).

Specifically, the complaints were basically about excess/unauthorised charges, frauds, guarantees, dispense errors and funds transfers.

Total claims made by customers during the period amounted to N7.995 billion and $1.767 million, while N3.093 billion and $1.724 million were refunded to them.

Also, 1,496 of these complaints were successfully resolved or closed in the period under review, compared with 4,723 in the first half of 2018, indicating a decrease of 3,227 or 215.71 per cent.

Meanwhile, reported cases of fraud and forgeries by banks increased to 25,029 at end of December 2018, from 20, 774 at end of June 2018.

During the period, various cyber-attacks were carried out on high profile entities, including the Central Bank of Bahamas, Marriot Hotels, Google plus, Arik Air, British Airways and UK NHIS, among others, leading to the loss of customers’ private information, revealing the vulnerability of all classes of organisations.

In Nigeria, the total amount involved decreased to N18.94 billion at end of December 2018, from N19.77 billion at end of June 2018.

Similarly, actual losses declined to N2.21 billion in the period under review from N12.1 billion in the first half of 2018.

Also, the total number of reported fraud cases in OFIs stood at 754 at end of December 2018, while the actual loss of N120.98 million was recorded during the same period.

The Automated Teller Machines (ATM) and mobile money channels recorded the highest incidences of fraud. In order to tackle this trend, bank customers were continually sensitized on safe banking practices while banks were encouraged to implement strong authentication controls and carry out comprehensive infrastructure risk assessments.

The United States Federal Bureau of Investigation had issued a warning to banks on a new type of fraud known as the ATM Fraud or ATM Cloned Card fraud, which involves hackers accessing bank systems or payment card processors and altering data to withdraw large sums of cash within a short period.

In response to this warning, CBN carried out vulnerability assessments on all banks and payment system providers and directed the remediation of identified vulnerabilities on all ATM servers.

To mitigate the incidence of attacks in the financial system, the apex bank released cyber- security framework and guidelines for banks and payment service providers.

The framework stipulates, among other requirements, the establishment of Cyber-Threat Intelligence (CTI) programmes to proactively identify, assess and mitigate potential cyber-threats.

It also stipulates the appointment of a “Chief Information Security Officer” (CISO) to oversee and implement a bank’s cyber-security programme.

In line with good practice, CBN appointed a CISO to oversee its cyber-security programme, while urging banks to follow immediately.

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