CBN, DMBs strategies over bank fraud and theft

 There are indications that Central Bank of Nigeria, CBN and Deposit Money Banks, DMBs are jointly working towards eradication of fraud and theft in the banking sector, sustaining customers trust and confidence in the sector.

According to a statement received by our reporter from CBN's Director, Corporate Communications, Mr. Isaac Okorafor, DMBs are expected to set and implement mandatory daily limits for Automated Teller Machine (ATM) withdrawals, as regarding card fraud and theft.

 “While other related transactions, including Point of Sales (POS) and Web purchases should be subject to stringent limits as agreed and documented between the DMBs and their customers.

The statement said: “DMBs must send SMS alerts to the telephones and email addresses of cardholders whenever there is a debit/credit transaction via payment card.

“Deposit Money Banks DMBs should set and implement mandatory daily limits for Automated Teller Machine ATM cash withdrawals and no debit card should be issued on an account without a written request from the account holder. The use of second level authentication for internet transactions is mandatory for all payment cards.

“All card issuing banks should deploy fraud monitoring tools that have the capability to monitor the normal spending trends of a card holder as well as automatically stop abnormal transactions that are perceived to be fraudulent,” he explained.            

He warned that DBMs must desist from using temporary staff, such as students on industrial attachment/vacation job, NYSC members and contract staff for card management and issuance/distribution of PIN mailers should be discouraged.

“Banks shall on a monthly basis, and not later than the 10th day of the following month, submit data and other information on agent operations including the nature, value and volume of transactions, to the CBN. Others include “incidents of fraud, theft or robbery; and nature and number of customer complaints and remedial measures taken,” Okorafor said in a statement.

However, CBN requires that financial institutions must put in place appropriate consumer protection systems against risks of fraud, loss of privacy and service.

In addition to the existing guidelines and circulars, the CBN, in collaboration with other industry stakeholders, has established a Nigeria Electronic Fraud Forum NEFF.

Banks and other payments service providers come together to discuss issues around prevention of fraud related activities in the payments system.

“Information gathered proofed that DBMs in their effort in combating fraud and theft always ensure that cardholders are provided with capacity to obstruct their accounts immediately from their mobile phones whenever the SMS alert is received in respect of suspicious transactions so as to prevent further fraudulent acts.

Today’s financial institutions need a real-time automated system to detect fraud across multiple channels and millions of transactions a day,” he added.