EFCC Chairman Attributes Rising Bank Fraud To Weak KYC Compliance
LolThe Chairman of the Economic and Financial Crimes Commission (EFCC), Ola Olukoyede, has identified weak compliance with Know Your Customer (KYC) protocols as a significant factor behind the growing cases of fraudulent activities within Nigeria’s financial sector.
Speaking during a stakeholder meeting in Abuja, Olukoyede emphasized that fintech companies and banks often fail to enforce robust KYC measures, especially during customer onboarding for tier-one accounts. This oversight, he said, creates loopholes that fraudsters exploit to perpetrate financial crimes.
Olukoyede highlighted that unbanked, under-served, and middle-class populations are particularly vulnerable to fraud due to inadequate internal controls by fintech firms.
“Fraud thrives in the absence of stringent KYC processes. Many fintech companies open tier-one accounts without proper verification, leaving these accounts susceptible to misuse,” he explained.
To mitigate the risks, Olukoyede called for improved internal controls within fintech systems and strengthened collaboration between financial institutions and the EFCC. He stressed the importance of seeing fintechs as stakeholders in the fight against corruption and urged them to promptly respond to inquiries and requests from the commission.
“Increasing collaboration with the EFCC signals a commitment to fighting corruption. Together, we can address the vulnerabilities that fraudsters exploit and improve the security of financial systems,” Olukoyede noted.
The EFCC Chairman assured stakeholders that the commission remains open to providing support and guidance to help financial institutions establish better controls and reduce the prevalence of financial crimes.
Olukoyede reiterated the EFCC’s dedication to enforcing and investigating economic and financial crimes. He applauded fintech companies for their willingness to collaborate and emphasized that a unified approach is essential to tackling fraud effectively.
The call to action highlights the growing need for a robust regulatory framework and greater accountability within Nigeria’s financial sector to protect customers and enhance the integrity of the system.
