BANK FRAUD AND MALPRACTICE: SOURCES, FORMS AND CAUSES
BANK, FRAUD, MALPRACTICE SOURCES FORMS, CAUSES
Bank Fraud And Malpractice: Sources, Forms And Causes, Table Of Contents
Background Of Study
Statement Of Problem
Scope-limitation Of Study
Objective Of Study
Significant Of Study
Definition Of ...
TABLE OF CONTENTS
BACKGROUND OF STUDY
STATEMENT OF PROBLEM
SCOPE, LIMITATION OF STUDY
OBJECTIVE OF STUDY
SIGNIFICANT OF STUDY
DEFINITION OF THE TERMS
WHAT IS FRAUD AND MALPRACTICE
SORUCES, FORMS AND CAUSES
THE EFFECT OF BANK FRAUD AND MALPRACTIVE
SUMMARY OF FINDINGS
1.1 BACKGROUND OF THE STUDY
Banking activities in Nigeria date back to the free wanting between 1895 when
the first bank, the African banking corporation where enacted in Nigeria.
In the free-banking period (1892 – 1952) there were no banking acts neither
were there any ordinances to regulate the establishment and operation of
commercial banks in Nigeria, many bank were registered some of which did not
mean business while others simply collected customers deposits and
vanished. This derailed the economy of valuable funds needed for
development and individuals of their herd earned funds. This also brought
about loss of faith and trust in the commercial banks by Nigerians.
However, even with the introduction of the first banking ordinance in 1952 and
the Central Bank of Nigeria (CBN) ordinance in 1958 to regulate and control the
activities of commercial and merchant banks in the country, fraud and
malpractice have increased in size and the method used required greater
sophistication by the day.
Fraud in our banks invoices summary techniques or forms such as: forgeries of
bank instruments like: drafts, cheque, vouchers, letter of authority,
falsification of accounts and records and cash fraud, from past records the
assumptions is that dishonest or misappropriation or rather fraud in which ever
form, succeed only with the aid of bank employees who conceives with disguised
customers wearing innocent faces inefficiency and negligence in terms of
leadership or supervisory roles on the part of the bank officials constitute
yet another handicap through which dishonesty, fraud perse prevail or succeed
in our banks. This can manifest as prescribed by the industry.
Presently, with the instruction of modern banking proceeding improved
communication system, automotive electric gadgets and computers into banking
industry, frauds have rather gone nuclear dimension inspire of the wonderful
nature of the computer and all the precautionary measure taken by banks to
prevent fraud in their banks. The amount involved in fraud nowadays have
increased in geometric progression Olaleya Amupiten in his written on
‘obstacles to growth of banking industry” said that “it was discovered during
investigation that banks now take extra precaution before clearing a cheque
because of rampant incident of frauds and forgeries, which a bank loss placed
on the average of N1 million per each working day of the year in Nigeria.
Banking in a bid to reduce the incessant occurrence of frauds in their banks,
now take adequate precautionary measures before clearing cheque drawn on their
customers accounts. Those adequate precautionary measures gives rise to
another problem facing commercial banks that is the problem of time wastage in
the banking halls. Ashimi Kola in his article also said that
customers wait a minimum of about two hours in the banking halls of Nigerian
banks to cash their money. This has been one of it’s most legitimate
criticism of the quality of baking services. The checking process is long
and by the time a cheque is released to the cashier for payment the customer is
frustrated and perhaps had fallen asleep. This calls for an overall of
the checking and control system.
The above gives light of the general situation of things commercial banks.
Fraud is therefore a major enemy to all concerned with the growth and
development of our banks. The intention of this researcher work is
therefore, aimed at the identification of the causes of fraud.
In our banks, the effects or
consequences of banks fraud in Nigeria economy and also to recommend more
functional measures that will help in the minimization and control of frauds.
OF THE PROBLEM
In recent times, bank frauds
dominate the front pages of our
daily newspapers, such striking
and easily recalled to the mind headlines include. “cashier nabbed over
N80,000” “accountant arrested and two escaped”, and three forfeit
N3million, “men of “419” invaded banks”, “large scale fraud in banks”, just to
mention but a few.
The industry has continued to
witness increased numbers of frauds and malpractice with varying degree of
sophistication. It was reported by the Nigeria deposit insurance
corporation (NDIC) that “Banking industry has lost but N1billion of to fraudsters
last years, indicating a continuing January and March 1993, out of record fraud
attempts involving n4million.
In 1991 a total of
N360.2million was involved in fraud, with actual loss amounting to 25.2million,
compared with theN788.8million recorded in 1990. Although the actual loss
worsened by 13.8 percent in the 1996.
This shows that while bank
management are busy working out means of checking fraud and malpractice
fraudsters on the other hand in conjunction with some dishonest bank are
designing new methods on how to circumvent these measures. It will then
be pointed out here that the results or implications of these are damaging
frauds and malpractice leads to unnecessary loss of huge amount of money.
This loss of money by the banks cripples banks activities and transaction.
Again, every incidence of
frauds and malpractice reduces public confidence on bank, hence they question
the credibility of the banking industry in protecting their money and meeting
up with daily transactions.
Furthermore, the banks frauds
and malpractice delays or shows down the development of banking habits in
Nigeria people shy away from banks in fear of losing their money in case of
Banks fraud and malpractice
keeps the management of banks alert and cause them to waste resources and
energies on fraud prevention and detection. It is therefore the adverse
position banks fraud and malpractice places on these sector of the economy that
crops up this projects
OF THE STUDY
In view of the fore-mentioned
problems, it becomes
obvious that if nothing
positive is done to check these incidence of frauds and malpractice, it may led
to frequent bank liquidations in the economy. The objectives of this
research work is therefore:
to carry out the survey and investigations on the major types o bank frauds and
malpractice in Nigeria using some selected commercial bank in Enugu zone as a
to determine the causes and the basic factors encouraging bank fraud and
malpractice and examine the various forms and areas of occurrence;
to look into the possible effects or consequences of bank frauds and
malpractice in the operation of bank in Nigeria;
to examine the various management and government devices feared towards
eliminating or controlling financial fraud;
Finally, to present recommendations or solutions that may help in reducing if
not eliminated bank frauds or malpractice.
Bank fraud and malpractice like
cancer worm have eaten
deep into the fabric of the
baking industry in view of that, all efforts have been made in the is research
work and all possible avenues exploitered so as to proffer solutions on reduction
or prevention of bank fraud and malpractice.
This research will be for mutual benefits of banks managements shareholders and
mostly to customers whose deteriorating confidence on the banking industry will
once be restored. This leading to overall security of fraud and assets of
the organization for the achievement of management overall goals.
The oxford advance learners dictionary defines it as “the action or an instance
of deceiving somebody in order to make money or obtain goods illegally.
This is the civil causes of wrong doings which may constitute criminal offences
such as falsification of accounts, alternation of record or documents,
manipulation. However, the research work will deal mainly with or on
fraud as it is most widely known.
TERMS AND CONDITIONS APPLY
For more informations on project materials and more