Fraudsters are targeting over three N3 trillion in accounts yet to be linked to the central bank of Nigeria introduced biometric verification number (BVN), according to tech and financial analysts.
The analysts, who spoke at a CEO roundtable facilitated by Ericsson and International Data Corporation, said that privileged information available to them showed that certain hackers, with collaborators from within the country and across the world, were developing a Ransomware to attack banks’ data systems to steal the funds.
Ransomware is a malicious code that is used by cybercriminals to launch data kidnapping and lock screen attack, demanding that money be paid before its release.
With over N2.19 billion lost by banks to fraudsters through electronic channels in 2016 fiscal period, the new development may raise losses astronomically by year-end if the threat is not contained.
The analysts specifically stated that some of the abandoned funds were proceeds of corruption and needed to be cleared from the banking system. They however warned that should the CBN remove the N3trillion from the banks, it would create a serious liquidity challenge in the banking system.
Akim Yusuf, senior assistant to the minister of communications on digital transformation, said “the corruption that has led to the trapped N3 trillion is being perpetrated by Nigerians who have no self-control,” adding that antidotes needed to be developed via institutional mechanism.
“We need to put in place mechanisms to monitor the flow of funds in the public sector. This is why we have introduced policies like the Treasury Single Account and the Biometric Verification Numbers.
“We need to increase the level of digital tracking of funds to curb corruption. We plan to move all government services online. This will minimize the use of cash, which encourages bribery.” He noted.
The spokesman also said that there was also the need to consolidate and harmonise the multiple biometric data systems in the country to make it difficult to hide illicit funds.
Rutman Rutger, managing director, Ericsson Nigeria, said the firm put together the event to provide a platform for dialogue between all stakeholders in Nigeria’s technology and financial sectors for digital transformation in Nigeria and curbing corruption in the financial technology sector.
Since 2014 he added, “We have positively impacted 89 million people through our technology for good programmes since 2014,” he said.
A breakdown of the actual amount lost to fraudsters through electronic channels showed that across the counter transactions with a total value of N511.07 million accounted for the highest losses.
This was followed by Automated Teller Machine (ATM) transactions with N464.5 million, Internet banking N320.66 million, Point of- Sale, POS, transactions, N243.32 million, and mobile banking transactions, N235.17 million among others.
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