The Economic and Financial Crimes Commission (EFCC) has called for the suspension and prosecution of deposit banks, Fintechs and microfinance banks aiding and abetting fraudsters in defrauding Nigerians through fraudulent schemes.
The Director of Public Affairs of the Commission, Wilson Uwujaren, made the call in Abuja, on the sidelines of a news briefing about negligence and compromise of the financial institutions that cost victims billions of naira.
Uwujaren said that the commission uncovered widespread compromise within Nigeria’s financial system, involving an N18.7 billion investment scam and fraudulent transactions of N162 billion in cryptocurrencies.
He accused one new-generation bank, six Fintechs and some microfinance banks of aiding and abetting fraudsters in laundering their 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.”
He said that the financial institutions clearly compromised banking procedures and allowed the fraudsters to safely change their ill-gotten gains into digital assets and move 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 said that the scams of N18.7 billion were in two categories, adding that the first was a syndicate of fraudsters that employed an airline discount scheme to lure their victims.
The second one, according to him, involved a company named Fred and Farid Investment Limited, simply called FF Investment, which lured Nigerians into a bogus investment arrangement.
“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.”
He said that over 700 victims had fallen into the trap of fraudsters through the scheme with a total loss of N651.1 million.
Uwujaren said that the commission succeeded in recovering and returning N33.63 million to victims of the scam and cautioned Nigerians to be more vigilant.
The second scheme, according to him, involved a company named Fred and Farid Investment Limited, simply called 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 said that foreign nationals are behind the schemes, with three Nigerian accomplices who have been arrested and charged in court
