Financial Crime World

Fraudulent Activities: Cash Deposits Suppression a Major Concern

Introduction

A recent report by the Bank of Ghana has revealed that suppression of cash deposits was a major fraudulent activity in the banking industry in 2019. The report highlights key statistics and recommendations to prevent fraud in the banking sector.

Key Statistics

  • In 2019, 2,295 fraud cases were reported, compared to 2,175 cases reported in 2018.
  • Email Fraud had the highest attempted value in 2019 (GH¢20 million).
  • The fraud case with the highest loss value involved a cyber-attack amounting to GH¢6.91 million.
  • There was a 72% decrease in the value of attempted fraud in 2019 compared to 2018.
  • Losses incurred from cybercrime increased by 193% in 2019 compared to 2018.

Directives and Recommendations

The Bank of Ghana has issued directives to banks, specialized deposit-taking institutions, electronic money issuers, and cheque printing companies to prevent fraud. These include:

  • Contract Staff Vetting: Contract staff must be adequately vetted by the Police Service to curb the practice of employing fraudsters.
  • Remuneration and Working Conditions: Remuneration and working conditions of contract staff and mobile bankers should be reviewed and aligned with that of permanent staff.
  • KYC/CDD System Strengthening: The Know-Your-Customer/Combating the Financing of Terrorism (KYC/CDD) system of banks and specialized deposit-taking institutions should be strengthened.
  • Suspicious Transaction Reports: Banks are required to file suspicious transaction reports and cash transaction reports in line with the Bank of Ghana and Financial Intelligence Centre’s anti-money laundering guidelines.

Recommendations to the Telecommunication Industry

The report also made recommendations to the telecommunication industry, including:

  • Enhanced Registration and Monitoring Processes: Enhancing registration and monitoring processes to reduce incidence of fraudulent call diversion, chip swaps, and number porting.
  • Cyber Security Infrastructures: Enhancing cyber security infrastructures to prevent unauthorized access in line with regulatory requirements.

Conclusion

The Bank of Ghana has urged financial institutions to implement the guidelines to curb the recurrence of fraud in the banking industry. Failure to comply with these directives may attract appropriate sanctions. It is essential for banks and other financial institutions to prioritize anti-fraud measures to maintain customer trust and ensure a secure financial system.