The value of reported fraud cases in the banking sector for the year 2020, the Bank of Ghana (BoG) says increased by 765 percentage points reaching GHs 1 billion.
This is from a 2019 figure of GHs 115.51 million.
The increase in the value of reported fraud cases the BoG notes was as a result of high values recorded in attempted correspondent banking fraud (forgery of SWIFT advice).
Even though the banking sector did not suffer any losses from any of the correspondent banking fraud attempts, it posed a reputational risk to some banks, whose staff were found culpable in two of the three reported incidents,” said the BoG in its newly released 2020 Banking Industry Fraud Report.
With regards to the number of fraud cases reported in the review period, the Central Bank in the report asserts that reported fraud incidents increased marginally with a
minimal decrease in total losses.
Read also: BoG report: Fraud cases in banking sector increase by 5.5% in 2019
The reduction in losses, the BoG further explains in the report was mainly due to a reduction in the rate of success for most fraud types. In all, a total case count of 2,670 cases were recorded in the year 2020, as compared to the 2,311cases recorded in 2019.
Losses incurred as a result of fraud for 2020 stands at GH¢25.40 million, as compared to an estimated loss of GH¢33.44 million in 2019, representing a 24.0%
decrease,” added the BoG.
According to the Bank, some fraud types experienced a significant increase in the rate of success, as compared to 2019, whiles others recorded a remarkable decrease in their rate of success, in comparison with 2019.
Fraud types such as ATM/POS fraud, impersonation and remittance fraud recorded significant increases in their rate of success for the period under review.
ATM/POS related fraud accounted for 32.2% of total fraud-related loss incurred in 2020 and recorded the highest loss value of GH¢8.19 million in 2020, as compared to GH¢1.26 million recorded in 2019, representing a 548.1% increase in year on year terms,” averred the Central Bank.
The BoG asserts the non-familiarity of customers in the use of electronic/digital methods to undertake financial transactions coupled with the increased patronage of electronic/digital products and services of banks due to the emergence of the Covid-19 pandemic exposed customers to heightened levels of fraud-related risk in 2020, hence the surge in the value of reported cases.
The Bank is of the view that banking sector has become more susceptible to fraud due to the increased use of innovative emerging technologies for business transactions.
It has however, made some key recommendations such as consumer education on the safe usage of digital/electronic products, the improvement of KYC information gathered by mobile money operators (MMOs), and the acquisition of transaction monitoring systems by MMOs to help monitor suspicious transactions, to help fight current fraud trends in the industry.
