Fraudsters have embezzled N329 million through the registration of Bank Verification Numbers (BVN) using static images. A report by NIBSS details how some agents registered these images as live enrollees, leading to the creation of fraudulent accounts across financial institutions. Despite a fall in reported fraud cases, the financial toll from fraud has surged, prompting urgent reforms in monitoring and reporting practices.
Fraudsters have exploited images to register for Bank Verification Numbers (BVN), resulting in a staggering loss of N329 million. A recent report by the Nigeria Inter-Bank Settlement System (NIBSS) reveals that unscrupulous BVN enrollment agents facilitated this fraudulent activity by submitting still images of both Nigerians and foreigners as genuine live registrants. These fraudulent BVNs were subsequently used to establish fake accounts across various financial institutions, including microfinance banks and mobile money operators.
The fraudulent operation enabled various transactions amounting to N329 million shortly after these fraudulent BVNs were generated. Investigations found that several BVNs created using static images were linked to Nigerian names, complicating efforts to identify their fraudulent nature during enrollment. As a result, numerous fraudulent BVNs were deleted, and the implicated agents have been reported to law enforcement for potential arrest and prosecution.
The NIBSS report states, “Still images of Asians and Nigerians are taken and enrolled for BVN by recalcitrant agents. Accounts are opened with these BVNs in MFBs, MMOs, and PSBs.” The report also indicates that fraud losses in Nigeria soared to N52.26 billion in 2024, marking a 350 percent increase from N11.61 billion recorded in 2020. Remarkably, despite this increase in fraud losses, the number of reported fraud incidents decreased by 31 percent, from 101,624 in 2020 to 70,111 in 2024.
This surge in financial fraud losses has been attributed to increasingly sophisticated fraud schemes, vulnerabilities within systems, and a rise in high-value fraudulent incidents. Attempted fraudulent transactions amounted to N86.36 billion in 2024, with actual losses rising by 195 percent compared to the previous year. To combat fraudulent BVN activities, the Central Bank of Nigeria has mandated that financial institutions must report fraudulent BVNs to NIBSS within 24 hours of detection.
The fraudulent exploitation of static images for registering Bank Verification Numbers has led to significant financial losses totaling N329 million, highlighting the vulnerabilities within Nigeria’s financial sector. Despite a decline in the overall number of fraud cases, the financial impact of fraud has dramatically increased, necessitating urgent action and collaboration amongst financial institutions, regulators, and law enforcement to enhance controls and reporting mechanisms against such schemes.
Original Source: punchng.com
