Fraudsters have stolen N329 million by using static images to falsely register for Bank Verification Numbers in Nigeria. A report from the Nigeria Inter-Bank Settlement System reveals that some BVN enrollment agents participated in this fraudulent scheme. The report highlights rising trends in financial fraud and outlines regulatory measures to combat these activities.
Recent reports indicate that fraudsters in Nigeria have exploited static images to fraudulently register for Bank Verification Numbers (BVN), resulting in a loss of N329 million. The Nigeria Inter-Bank Settlement System’s findings reveal that unscrupulous BVN enrollment agents have been instrumental in this fraudulent scheme by using photos of both Nigerian and foreign individuals as if they were live enrollees. Subsequently, these fraudulent BVNs were employed to open accounts across various financial institutions, including microfinance banks and payment service banks.
Investigations have revealed that shortly after the creation of these fraudulent BVNs, transactions were conducted that totalled N329 million. The reports further suggest that many of these BVNs were assigned local Nigerian names, complicating detection during the enrollment process. This led to the deletion of several fraudulent BVNs, and those responsible for the scheme have been turned over to law enforcement for potential prosecution.
The NIBSS report highlighted that overall losses due to fraud in 2024 surged dramatically to N52.26 billion, marking a 350 percent increase from N11.61 billion reported in 2020. Conversely, the total number of reported fraud cases decreased by 31 percent, showing a decline from 101,624 in 2020 to 70,111 in 2024. This paradox of rising fraud losses amidst fewer reported cases points to the evolving sophistication of fraud strategies and vulnerabilities within systems.
Furthermore, attempted fraudulent activities reached N86.36 billion in 2024, with actual losses experiencing a 195 percent increase compared to the previous year. In an effort to mitigate these fraudulent activities associated with BVN, the Central Bank of Nigeria has mandated that financial institutions report any fraudulentBVN within 24 hours of detection, enhancing vigilance and accountability within the financial sector.
In summary, the exploitation of static images to generate fraudulent BVNs has resulted in significant financial losses in Nigeria’s banking sector. The challenges posed by sophisticated fraud schemes have led to increased losses despite a decline in the number of reported cases. Efforts by the Central Bank of Nigeria to regulate and monitor these fraudulent practices aim to protect the integrity of the financial system.
Original Source: punchng.com
