Fraudsters in Nigeria exploited static images to generate Bank Verification Numbers, resulting in N329 million in losses. A report by NIBSS revealed that these fraudulent BVNs were used to open bogus accounts. The overall fraud losses in 2024 soared to N52.26 billion while reported cases decreased, indicating more sophisticated fraud techniques. The Central Bank has mandated immediate reporting of fraudulent BVNs to combat this issue.
Fraudsters have illicitly appropriated N329 million by utilizing static images during the registration process for Bank Verification Numbers (BVN). A recent report from the Nigeria Inter-Bank Settlement System (NIBSS) reveals alarming trends in financial sector fraud in Nigeria. The report, acquired by Sunday PUNCH, indicates that at least some rogue BVN enrollment agents participated in this scheme by registering images of individuals, both Nigerian and foreign nationals, as authentic enrollees.
The fraudulent BVNs facilitated the creation of bogus accounts across various banks, including microfinance institutions, mobile money operators, and payment service providers. These fraudulent accounts executed transactions amounting to N329 million, occurring mere days after the creation of the fake BVNs. Further investigations uncovered that many BVNs generated from static images were given Nigerian names, which further complicated the detection of fraud during the enrollment procedures.
As a result of these findings, numerous fraudulently created BVNs were deleted, and the individuals behind the scheme have been reported to law enforcement agencies for potential arrest and prosecution. The report highlighted that “Still images of Asians and Nigerians are taken and enrolled for BVN by recalcitrant agents,” illustrating the audacity of the agents involved in this scheme.
In 2024, total losses attributed to fraud escalated to N52.26 billion, marking a 350 percent increase from the N11.61 billion reported in 2020. Despite this surge in monetary losses, the number of reported fraud cases declined by 31 percent, dropping from 101,624 cases in 2020 to 70,111 in 2024. The report attributes the increase in fraud losses to enhanced fraud schemes, system vulnerabilities, and a notable rise in high-value fraudulent activities.
Attempted fraud transactions in 2024 amounted to N86.36 billion, exhibiting a staggering 195 percent rise compared to the previous year. In response to this concerning trend, the Central Bank of Nigeria has mandated that financial institutions report any identified fraudulent BVNs to the NIBSS within 24 hours of discovery, aiming to tighten security against such fraudulent activities.
In summary, the misuse of static images for BVN enrollment has led to fraudulent activities costing N329 million in Nigeria. Despite a decline in reported fraud cases, monetary losses have dramatically increased, highlighting the sophistication of emerging fraud schemes. Authorities are now under increased pressure to enhance reporting measures and combat these fraudulent practices more effectively.
Original Source: punchng.com
