BoG investigating ATM fraud cases

The Governor of the Bank of Ghana (BoG), Dr Ernest Addison, has said that the central bank is still investigating cases of Automatic Teller Machine (ATM) frauds in the country.

He said during the 102nd Monetary Policy Committee of the BoG press conference in Accra on Monday September 27 that the regulator is working to ensure a safer cyber space for the banking sector in Ghana.

Asked what the BoG is doing to deal with cases of ATM Fraud, Dr Addison said “This is a developing matter, we are investigating it. As you know the financial services are becoming technology driven financial services , the risk associated with ATMs will also go up. Fortunately, we are looking very closely at that.

“We have the security operating centre at the Bank of Ghana which monitors our cyber resilience. Currently we are in the midst of establishing Financial Industries Hub.

“I believe the Bank of Ghana is ready, the Agriculture Development Bank is getting connected to that FisHub.

“Hopefully by a year from now we will have all 23 banks will connected to the industries hub and we will be able to monitor the cyber risk associated with the entire banking system in Ghana.”

The banking industry continues to record rising cases of fraud, with the latest figure hitting GH¢I billion in 2020, compared to GH¢115.51 million recorded in 2019.

A total count of 2,670 cases of banking fraud were recorded in 2020, as compared to 2,311 reported cases in 2019.

In all, there were 2,670 cases of fraud reported in 2020, up from the 2,311 cases reported in 2019.

This is contained in the 2020 banking industry fraud report released by the BoG.

The banking sector fraud is mainly done through the ATM/POS (Point-of-Sale), impersonation and remittance, which had recorded significant increase in 2020.

Related cases using ATM/POS accounted for 32.2 per cent of the total fraud in the sector, recording the highest loss value of GH¢8.19 million in 2020, up from the GH¢1.26 million recorded in 2019, representing a 548.1 per cent increase.

According to the report, the outbreak of the COVID-19 pandemic forced bank customers to use alternative channels for payments and bank services.

But poor personal safety perception and inadequate customer sensitisation by banking institutions caused an upsurge in fraud perpetrated through ATM/POS.

The report states that the banks continued to maintain a 100 per cent rate of submissions, and that the rural and community banking sector also recorded a 75 per cent rate of submissions.

According to the report, although the banking sector did not suffer any losses from any of the banking fraud attempts, it posed a reputational risk to some banks whose staff were found culpable in two of the three reported incidents.

The losses incurred as a result of fraud for 2020 stands at GH¢25.40 million, as compared to an estimated loss of GH¢33.44 million in 2019, representing a 24.0 per cent decrease.

The notable increase in the value of reported cases was as a result of high values recorded in attempted correspondent banking fraud through forgery of SWIFT advice.

The central bank attributes the steady rise of banking fraud to the use of poorly remunerated temporary staff who undergo limited background checks for sensitive tasks and a lack of corporate governance systems which would have helped to ensure accountability, fairness and transparency.

By Laud Nartey|3news.com|Ghana