The Economic and Financial Crimes Commission (EFCC) has called for the suspension and prosecution of deposit money banks, fintech companies, and microfinance banks accused of aiding and abetting fraudsters in defrauding Nigerians through large-scale fraudulent schemes.
The call was made by Wilson Uwujaren, Director of Public Affairs of the Commission, in Abuja on the sidelines of a news briefing on negligence and compromise within financial institutions that have allegedly cost victims billions of naira.
Uwujaren disclosed that EFCC investigations uncovered widespread compromise in Nigeria’s financial system, involving an ₦18.7 billion investment scam and ₦162 billion in fraudulent cryptocurrency transactions.
He accused one new-generation bank, six fintech firms, and some microfinance banks of facilitating the laundering of illicit proceeds.
“It is worrisome that investigations by the commission showed that cryptocurrency transactions to the tune of N162 billion passed through a new generation bank without any due diligence.
“Investigations also showed that a single customer maintained 960 accounts in the new generation bank, and all the accounts were used for fraudulent purposes.”
Uwujaren said the affected financial institutions clearly breached banking procedures, enabling fraudsters to convert illicit funds into digital assets and transfer them to safe destinations.
“The Commission is calling on regulatory bodies to bring financial institutions to compulsory compliance with regulations in the areas of Know Your Customers (KYC), Customer Due Diligence (CDD), Suspicious Transaction Reports (STRs) and others.
“Deposit money banks, Fintechs and microfinance banks found to be aiding and abetting fraudsters should be suspended and referred to the EFCC for thorough investigation and possible prosecution,” he said.
He explained that the ₦18.7 billion scam comprised two major schemes. The first involved a syndicate that used an airline discount scheme to lure unsuspecting victims.
“The modality of the fraudsters in the airline scam involved a string of carefully devised airline discount information that any unsuspecting foreign traveller will fall for.
“What they do is to advertise a discount system in the purchase of flight tickets of a particular foreign carrier.
“The payment module is designed in such a way that their victims would be convinced that the payment is actually made into the account of the airline.
“No sooner is the payment made than the passenger’s entire funds in his bank account are emptied.”
Uwujaren said over 700 victims fell for the scheme, resulting in losses of ₦651.1 million, noting that the commission recovered and returned ₦33.63 million to victims while urging Nigerians to remain vigilant.
The second scheme, he said, involved Fred and Farid Investment Limited (FF Investment), which lured Nigerians into bogus investment arrangements.
“More than 200,000 victims have been defrauded in this regard. A total sum of N18.1 billion was raked in through nine companies offering diverse investment packages.”
Uwujaren added that the schemes were masterminded by foreign nationals working with three Nigerian accomplices, who have since been arrested and charged to court. (NAN)