Identity Theft on the Rise: 70% of Financial Crimes in Angola Linked to Banking Sector

The financial sector in Angola is facing a surge in financial crimes, with up to 70% of these malicious activities linked to the banking sector. This worrying trend has been highlighted by instances of substantial fraud losses in financial institutions such as Access Bank.

Staggering Fraud Losses in Angolan Banks

In 2023, Access Bank disclosed a loss of N6.5 billion due to fraudulent activities, with over 80% of the damages attributed to fraudulent transfers, withdrawals, reactivations, and electronic fraud through USSD.

The Need for Robust Identity Checks

These incidents have raised concerns about the need for more robust identity checks to fortify Angola’s digital financial environment.

Collaborative Efforts to Deter Financial Fraud

In response to this threat, the Central Bank of Nigeria (CBN), Nigerian Electronic Fraud Forum (NeFF), and the Association of Mobile Money and Banking Agents of Nigeria (AMMBAN) have collaborated to deter financial fraud. They are primarily focusing on the enforcement of Know Your Customer (KYC) protocols at Point of Sale (PoS) terminals.

Escalating Threat of Biometric Fraud

Additionally, biometric fraud, with rates reaching a record-high 13% in Q4 2023, poses a significant challenge to the continent’s financial defenses against identity theft and cybercrime.

Types of Fraud in the Angolan Financial Sector

Fraudsters employ various tactics such as phishing, card skimming, and document forgery to gain unauthorized access to bank accounts and cards, resulting in substantial financial losses and a deterioration of trust between consumers and financial institutions.

Transaction Fraud

Transaction fraud, including phishing, card skimming, and electronic fraud, is a major concern. These incidents can significantly impact the financial well-being of individuals and organizations.

Document Fraud

Document fraud, such as forged, manipulated, or stolen ID documents, is another major concern. With official ID documents serving as a crucial tool for verifying identities, financial institutions must remain vigilant to prevent scammers from circumventing basic security checks.

Biometric Fraud

Biometric fraud poses a daunting challenge as fraudsters look for ways to manipulate or replicate biometric data, such as facial features and iris patterns, to illicitly access services, personal data, and financial accounts.

Counteracting Identity Theft and Cyber Fraud in Angola

Identity theft and cyber fraud are on the rise in Angola, with financial institutions experiencing a 10% to 15% fraud rate in 2023. To combat the trend, the adoption of advanced identity verification technologies, such as KYC++, is crucial.

KYC++: An Innovative Solution

KYC++ is a global identity verification solution that integrates multiple security checks into a seamless process. By implementing document verification, biometric authentication, and device checks, it can significantly reduce the risk of fraud.

The Challenges of Adopting KYC++ in Angola

Despite the challenges, including varying regulatory environments and limited technological infrastructure, the benefits of the solution offer a promising path towards creating a more secure and reliable financial environment for Angolans.

Conclusion

As the fight against financial fraud continues, institutions must remain vigilant against the evolving tactics of fraudsters. The adoption of advanced identity verification technologies like KYC++ is essential to ensuring financial services are provided only to legitimate customers and reducing the risk of fraud.