First Financial institution, Nigeria’s oldest financial institution, was hit by an enormous fraud incident that led to the theft of ₦7 billion from buyer accounts by unknown individuals, based on one particular person with direct data of the matter. Three different individuals who requested to not be named discussing delicate firm issues confirmed the incident.
The scope and complexity of the incident spotlight the more and more refined nature of fraud in Nigeria’s monetary providers sector. Nigerian banks misplaced ₦43 billion to fraud in Q2 2024, but these numbers are probably underreported. Solely 60 of 163 monetary establishments in Nigeria reported fraud circumstances, based on a Nigeria Inter-Financial institution Settlement System (NIBSS) report; many select to not report incidents over concern of reputational hurt.
The fraud incident at First Financial institution, which reportedly started a number of months in the past, concerned the unauthorised diversion of funds from a number of buyer accounts. Whereas the precise mechanism of the fraud stays unknown, three folks with data of the incident stated the stolen funds have been then moved to a number of financial institution accounts, together with these of two fintech corporations, a tactic fraudsters use to obscure the path of illicit funds and make it tough for regulation enforcement to hint and get better the cash.
Regardless of the massive quantity concerned, the fraud reportedly went undetected for months, suggesting vital inner management gaps. In Might 2024, TechCabal reported {that a} First Financial institution worker had fraudulently diverted ₦40 billion over a two-year span earlier than finally being found. Two folks with direct data of the matter stated the financial institution’s complete audit confirmed that the whole quantity the worker diverted was round ₦60 billion.
That incident led to the dismissal of 100 workers and was considered related to the abrupt exit of the financial institution’s CEO.
First Financial institution didn’t reply to a request for feedback on this story.
In line with two folks with data of the matter, First Financial institution has begun the restoration course of and reported the case to regulation enforcement. Banks and fintech usually work with the police and courts to get better stolen funds. It stays unclear if First Financial institution has taken authorized motion over the matter.