Money lost to fraud in Nigeria’s financial sector surged by N14.71 billion between 2019 and 2023, according to geopolitical research firm SBM Intelligence.
“The amount of money lost to fraud increased steadily from N2.96 billion to N17.67 billion over the reviewed period,” SBM reported. The banking sector faced escalating losses, with N11.61 billion in 2020, N12.77 billion in 2021, N14.32 billion in 2022, and N17.67 billion in 2023.
“Fraud is common in the financial sector globally, and in Nigeria, it is endemic,” SBM stated. Despite a decrease in the number of incidents since 2021, the value of losses has significantly risen. “This may indicate that perpetrators have improved their methods, allowing them to move larger sums undetected,” the firm added.
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In 2023 alone, N3.80 million was lost to vishing, a method where fraudsters deceive victims over the phone. Fake assistance schemes led to N1.01 billion in losses. Additional fraud sources include- Missing and lost cards: N122.2 million,Phishing:N551.2 million, Lack of two-factor authentication (2FA): N192.3 million and Card theft: N658.8 million
The sector also suffered massive losses from social engineering (N9.37 trillion), website/server hacking (N2.437 billion), robbery (N1.61 trillion), and pin compromise (N1.3 trillion). Internal collusion led to a loss of N1.03 trillion, while phone theft and SMShing resulted in N317.7 million and N30.7 million, respectively. SMShing, a form of phishing via text, exploits victims by prompting them to provide sensitive information through a link or call.
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SBM noted other fraud sources amounted to N363.3 million in losses.
Fraudulent incidents increased dramatically from 44,947 in 2019 to 123,918 in 2021. Despite a decline to 101,669 incidents in 2022 and further down to 95,620 in 2023, the financial impact has grown, indicating evolving tactics by fraudsters.
