Fraud Detection in the Banking System in Nigeria: Challenges and Prospects
How to cite (SHIRKAH) :
Fraud is an epidemic dimension that has eaten deep into the banking sector as well as the entire economics in Nigeria. Its devastating effect manifests itself in the deteriorating balance sheet of banks as well as in economic backwardness. Apparently, measures to detect and eradicate fraud in banking sector have been quite ineffective as the fraudulent practices have been on the increase in recent times. Thus, this study evaluates the various challenges of detecting and combating fraud in the banking sector in Nigeria. The results from the descriptive analysis showed that lack of adequate motivation is not a major cause of fraud in banks, looting of fund by bank managers and directors constitutes the major form of fraud in Nigeria. Furthermore, it is recommended that government should strengthened existing anti-graft agencies and to enhance their financial independence. Those managers and director involved in looting of fund should be persecuted to serve as a deterrent to potential fraudsters. In addition, bank staff should be properly screened to test their morality and integrity before recruitment. Adequate internal control mechanism should be established to serve as check and balances among the bank staff. There is also the need for the anti-graft agencies to be strengthened in order to adequately complement the effort of the Central Bank of Nigeria (CBN) at nibbling the incidence of bank fraud in the bud.
Keywords:Â banking system, fraud, fraud detection, fraud prevention, Nigeria
Adeoti, J. O. (2011). “Automated Teller Machine (ATM) Frauds in Nigeria: The way out,†Journal of Social Sciences, Vol. 27 (1), pp. 53-58.
Aderibigbe, P. (1999). “The Internal Audit Function And Fraud,†ICAN News Vol.4, No. 1.
Adeyemo, K. A. (2012). “Frauds in Nigerian Banks: Nature, Deep-seated causes, Aftermaths and Probable Remedies,†Mediterranean Journal of Social Sciences, Vol 3(2) May.
Ajisebutu, A. (2006). “Financial Statement Fraud: What Auditors Should Know,†The Nigerian Accountant, Vol 39(2).
Akinyomi, O. J. (2010). “The Effect of Internal Control System on Nigerian Banks,‟ International Journal of Accounting, Vol. 2 (1) pp. 123-129.
Asukwo, P. E. (1999). “Bank Frauds: A Look at the Nigerian Banking Clearing System,†ICAN News, January/March.
Carmody, P. (1998), “Constructing Alternatives to Structural Adjustment in Africa,†Review of African Political Economy (ROAPE), Vol. 25, No 75.
Eseoghene, J. I. (2010). “Bank Fraud in Nigeria: Underlying Causes, Effects and Possible Remedies,†African Journal of Accounting, Economics, Finance and Banking Research. 6(6): pp. 62-79.
Fakunle, B. (2006). Audit Companion, 2nd Edition. Lagos: L and Mark Publication.
Idolor, E. J. (2010). “Bank Fraud in Nigeria: Underlying Cause, Effects and Possible Remedies,†African Journal of Accounting, Economics, Finance and Banking Research, Vol. 6 (6), pp 62.
Idowu, I. (2009). “An Assessment of Fraud and its Management in Nigeria Commercial Banks,†European Journal of Social Sciences, Vol.10 (4), pp. 628-640.
Nigeria Deposit Insurance Corporation (NDIC) Annual Report and Statement of Account, Various Issues. Lagos, Nigeria.
Ogidefa, I. (2008). Fraud in Banking Systems in Nigeria (online) available via http://www Socyberty.com/Law/ Fraud-in-banking-system-in-Nigeria.
Ogwuma, P.A. (1981). “The Growth of the Banking Industry in Nigeria,†Paper Presented at the Annual Seminar of the Chartered Institute of Bankers of Nigeria, Bankers House, Lagos State.
Okubena, O. O. (1998). “An Investigation in Frauds in Banks,†An unpublished Thesis of University of Lagos, First Bank Quarterly Review June 1998 Edition.
Olatunji, O. C. (2009). “Impact of Internal Control System in Banking Sector in Nigeria. Pakistan Journal of Social Science,†Vol. 6, pp. 181-189.
Onibudo, A.T. (2007). “Bank Frauds Problems and Solutions,†Unpublished B.Sc. Research Project, University of Benin, Nigeria.
Ovuakporie, V. (1994). Bank Frauds: Causes and Preventions. Ibadan: ATS Book.
Copyright
Copyright aims to protect the specific way the article has been written to describe an experiment and the results. Shirkah: Journal of Economics and Business is committed to its authors to protect and defend their work and their reputation and takes allegations of infringement, plagiarism, ethical disputes, and fraud very seriously. Automotive Experiences is published under the terms of the Attribution-NonCommercial 4.0 International (CC BY-NC 4.0). Authors retain copyright and grant the journal right of first publication (online and print) with the work simultaneously. We use the restrictive license (non-commercial) as follows:
BY (attribution): Users are allowed to share, distribute and redistribute the published article in any medium or format, with an identification of the authors and its initial publication in this journal. Authors are encouraged to post and distribute their articles immediately after publication (e.g., institutional or public repositories, personal websites). Authors are allowed to enter into additional contractual arrangements for the non-exclusive distribution of the published and an acknowledgment of its initial publication in this journal.
NC (non-commercial): Users are not allowed to use the article commercially without the permission of the authors. Authors agree explicitly that the published article is indexed worldwide in databases, repositories and indexation services, even if these services operate on a commercial basis. Authors grant Shirkah: Journal of Economics and Business explicit the right to include the published articles in databases, repositories and indexation services. License
License to Publish
The non-commercial use of the article will be governed by the Attribution-NonCommercial 4.0 International (CC BY-NC 4.0). The author hereby grants Shirkah: Journal of Economics and Business an exclusive publishing and distribution license in the manuscript include tables, illustrations or other material submitted for publication as part of the manuscript (the “Articleâ€) in print, electronic and all other media (whether now known or later developed), in any form, in all languages, throughout the world, for the full term of copyright, and the right to license others to do the same, effective when the article is accepted for publication. This license includes the right to enforce the rights granted hereunder against third parties.
Author's Warranties
The author warrants that the article is original, written by stated author/s, has not been published before, contains no unlawful statements, does not infringe the rights of others, is subject to copyright that is vested exclusively in the author and free of any third party rights, and that any necessary written permissions to quote from other sources have been obtained by the author(s).
User Rights
Under the Creative Commons Attribution-Non Commercial 4.0 International (CC BY-NC 4.0) license, the author(s) and users are free to share (copy and redistribute the material in any medium or format) and adapt (remix, transform, and build upon the material). Users must give appropriate credit, provide a link to the license, and indicate if changes were made.
Rights of Authors
Authors retain the following rights:
- Copyright, and other proprietary rights relating to the article, such as patent rights,
- The right to use the substance of the article in future own works, including lectures and books,
- The right to reproduce the article for own purposes, provided the copies are not offered for sale, and
- The right to self-archive the article.
Co-Authorship
If the article was prepared jointly with other authors, the signatory of this form warrants that he/she has been authorized by all co-authors to sign this agreement on their behalf, and agrees to inform his/her co-authors of the terms of this agreement.
Royalties
This agreement entitles the author to no royalties or other fees. To such extent as legally permissible, the author waives his or her right to collect royalties relative to the article in respect of any use of the article by Shirkah: Journal of Economics and Business or its sublicensee.
Miscellaneous
Shirkah: Journal of Economics and Business will publish the article (or have it published) in the Journal if the article’s editorial process is successfully completed and Shirkah: Journal of Economics and Business or its sublicensee has become obligated to have the article published. Shirkah: Journal of Economics and Business may conform the article to a style of punctuation, spelling, capitalization, and usage that it deems appropriate.