FRAUD MANAGEMENT AND THE PERFORMANCE OF FINANCIAL INSTITUTES IN NIGERIA
Abstract
The project examines fraud management and performance of financial institutions in Nigeria. The study’s main objective is to know the magnitude of frauds in Nigeria banks and to know why and how banks personnel commit fraud. The primary source of data collection was used in gathering data from respondents. An empirical force affects the Nigerian banking sector, using the ordinary least square estimation (OLS) techniques called the exact AR Newton Raphson method. Data collected were presented in tables and percentages for easy understanding. It was discovered that within the period of review (2008 – 2013), an aggregate of five fraud cases were reported from the institution. It was also found out that the highest of the cases was foreign exchange transfer closely followed with that of interest computation and application of saving ledger account. It was concluded that adequate and close managerial supervision and control, regular accounts balancing were ranked as highly and most effective measures against fraud. It was recommended amongst others that there is need not to impose confidence to the extreme on employees, since human beings cannot be easily predicted.
CHAPTER ONE
INTRODUCTION
1.1Background to the Study
As in many other industries in the Nigerian economy, most banks are faced with problem of fraud. It might be a gross-over statement to call the Nigerian banking system citadels of frauds. Whilst, very truly, fraudulent practices are rampart in Nigeria the level (amount and number) of fraud is not unexpected of a developing and in experiencing banking system such as ours, it is so far to the credit of the Nigeria monetary authorities, the public at-large and perhaps any other concerned Nigeria that no bank has actually failed in Nigeria as a result of fraud. However, one should be disturbed by the regularity of fraud perpetration in our banks and effort should be made by all and sundry to make this bank to quite a reasonable extent of not totality.
The effect of fraud on our banks are far reacting a high height and they include; huge financial losses of the banks and their customer the depletion of shareholder’s fund and the banks capital base. Others are band management embarrassment and loss of confidence by the customers on our banks. The time, energy and money that would have been used in other development purposes expansion, customers, services and perhaps too, other social responsibilities, to the society-are diverted towards setting up fraud control and prevention system.
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