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Who should be blamed for rising cases of financial fraud; banks or telcos?



Who should be blamed for rising cases of financial fraud; banks or telcos?

Banks and Telecommunications operators in the country, Tuesday, traded blames over the rising cases of financial frauds perpetrated in the country through telecommunications networks.

The financial services providers and telecommunications companies tackled each other on who to bear the blame on financial frauds committed on bank customers’ accounts using telecommunications network at a stakeholder meeting on financial fraud using telecoms platform convened by the Nigerian Communications Commission (NCC).

There were also heated arguments on whether victims of such financial frauds should be classified as bank customers or that of the telecommunications companies.

Another subject of heated argument was who should bear the responsibility for the building of technology infrastructure that would help to detect when a wrong subscriber that had swapped a SIM initiated a financial transaction through the networks.

While telecommunications operators alleged that banks wanted the technology solution to be given to them free, the banks contended that their services provided a flow of income to telecommunications operators.

The Central Bank of Nigeria (CBN) and the Consumer Protection Council (CPC) however intervened to establish that the subscribers were bank customers even when they used technology platforms to carry out transactions.

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The Executive Vice Chairman, Nigerian Communications Commission, Prof. Umar Danbatta, in his address to the forum, said the commission was collaborating with the CBN, the Nigeria police and other relevant agencies in the fight against e-banking fraudsters.

He said: “This important forum is taking place at a time when the level of financial fraud has reached N12.5bn. So, something needs to be done urgently to secure the confidence of Nigerians in the financial system as well as a communications system in the country.

“Despite advances in software technology, human intervention is still required to prevent SIM swap fraud, which is quite difficult to detect. Also, controls and processes by network operators have to a degree failed and led to instances of human error in retail branches in distributing SIM cards.”

Also speaking at the event, the Minister of Communications, Mr Adebayo Shittu, noted that the incidence of financial fraud using telecoms platforms had been pervasive.

Shittu said: “We believe innovation needs to be meaningful to ensure that nations and societies everywhere benefit from technological advancement. Technology disruption has been infused in every facet of the Nigerian economy.

“The impact of online fraud cannot be underestimated or denied. Indeed, it leads to the loss of reputation and income and it is tied to direct financial loss of billions of naira in the financial sector, e-commerce and telecommunications.

“The frequency of identity theft is alarming and this is why the government is putting its full might behind efforts to confront this menace and to put an end to it.”

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