Revealed: How Nigerian Bank Workers Stole N39 Billion In Just 1 Year

Bank workers in Nigeria committed 37,817 fraud cases in 2018 where they stole N26.182billion. This is contained in the National Deposit Insurance Corporation (NDIC) report which showed that the bank employees stole N12.01 billion.

When put together, the amount stolen by the bankers in in just two years from their employers, whose major business is to keep customers’ deposits, was N38.93 billion.

The NDIC report further indicated that the actual amount lost to fraud cases in 2018 stood at N15.15 billion as against N2.37 billion and N2.40 billion in 2017 and 2016, respectively.

Of the number, a total of 899 workers were involved in fraud and forgery cases in 2018 compared to 320 in 2017. The number of temporary staff involved in fraud was 394, accounting for 43.83 per cent of the total number of workers involved in frauds. This was followed by officers and executive assistants’ cadre with 206 or 22.91 per cent, supervisors and managers accounted for 119 or 13.24 per cent of the total fraud cases.

This had led to more concerns over the surge in official involvement in fraud and forgery cases in the banking industry. The figure of insider manipulation of confidential information of bank customers in the banks has been on steady increase in recent years.

LEADERSHIP gathered that lack of job security, casualisation, poor remuneration and incompetence of senior management in several Deposit Money Banks (DMBs) were among the causes of the rising incidences of fraud and forgery in the industry.

It was also attributed to the increase in the sophistication of fraud-related techniques such as hacking, cybercrime as well as increase in Information Technology (IT)-related products and usage, fraudulent withdrawals and unauthorised credit.

According to the National Bureau of Statistics, the percentage of contract staff in banks rose year-on-year between 2017 and 2018 by 39.8 per cent as against the 15.7 per cent increase recorded for the entire staff in the sector.

In an interview with our correspondent, a professor of Economics and Public Policy at the University of Uyo, Akpan Hogan Ekpo, said that the fact that banks employ temporary/contract staff and keep them for so long is largely responsible for the ugly development.

He said that the banks do so to maximise or improve on their profit margins, noting that the contract staff do not enjoy certain benefits like the regular employees hence when opportunity avails itself for them to make money through fraudulent means, they succumb to such temptations.

“The rate is alarming. Discipline in the system has broken down; the economic hardship is also a problem,” Prof. Ekpo stated.

Other experts said the situation was reflective of the total breakdown of social values and the belief in get-rich-quick irrespective of the means in the Nigerian society.

One of the experts said that the present situation is that majority of the citizens and residents of Nigeria have no confidence in the system.

The chief executive officer of Precise Financial Systems, Dr. Yele Okeremi, said: “This is an evidence of a completely decadent society and it gets wise people very worried about what the future of the country portends.”

Okeremi said that the culture of some management treating employees like disposable machines had helped to build lack of sense of belonging in most bank workers. On the whole, Okeremi sees a situation where people are no longer interested in building institutions to last, adding that “they just want immediate results, a thing that should worry the authorities.”

To check the trend, the NDIC said that DMBs and the industry regulators need to address the problem of contract/temporary staff in terms of welfare and permanent employment in view of the risk their current status poses to bank operations.

Furthermore, banks should strengthen their internal controls and validate their recruitment process, the corporation said.

Similarly, Prof. Ekpo said that banks should hire and after probation period, make the ad-hoc workers permanent employee. He feels that the approach would reduce the number of contract staff in fraudulent practices.

Those who share his view said that there should be incentives for banks to recapitalise and not be forced to do so, adding that “the NDIC and the Central Bank need to intensify the examination of banks to ascertain why recapitalisation requirements have declined. For the banking sector, banks that cannot meet their capital adequacy should face the necessary sanctions. The authorities should not wait for the matter to degenerate before taking action particularly for banks that lend to the real sector.”

Okeremi concluded that while high capital requirement is good for banks, sound management practices are more significant for banks to survive and thrive.