EFCC flags systemic banking lapses after N18.7bn fraud

The Economic and Financial Crimes Commission (EFCC) has raised serious concerns over systemic lapses within Nigeria’s banking and fintech ecosystem following the uncovering of two major fraud schemes that siphoned over N18.7 billion from unsuspecting Nigerians.

Speaking in Abuja on Thursday, the EFCC’s Director of Public Affairs, Wilson Uwujaren, said the cases revealed deep weaknesses in compliance, customer due diligence, and transaction monitoring across parts of the financial system, allowing large-scale fraud to thrive undetected.

According to the Commission, a combination of one new-generation commercial bank and six fintech and microfinance institutions failed to apply basic Know-Your-Customer (KYC) and anti-money laundering controls, enabling fraudsters to move illicit funds seamlessly through formal channels.

One of the schemes involved a sophisticated airline ticket discount scam, in which fraudsters impersonated foreign airlines and convinced victims—many of them travellers—to pay into accounts designed to appear legitimate. Once payments were made, victims’ bank accounts were allegedly wiped clean.

The EFCC said over 700 victims lost about N651 million through the airline scam alone, noting that some of the proceeds were quickly converted into cryptocurrency and transferred offshore via digital trading platforms.

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The second scheme centred on a fake investment outfit, Fred and Farid Investment Limited, which promised high returns through multiple investment packages. Investigations revealed that more than 200,000 Nigerians were drawn into the scheme, with losses exceeding N18 billion, channelled through nine related companies.

EFCC investigators disclosed that foreign nationals coordinated the schemes with the help of Nigerian accomplices, some of whom have been arrested and charged to court.

Beyond the fraud itself, senior EFCC officials warned that the cases expose dangerous regulatory gaps. Investigations showed that cryptocurrency transactions worth N162 billion passed through a single bank without adequate scrutiny, while one customer reportedly operated 960 accounts used for fraudulent transactions.

Describing the findings as alarming, the Commission called on financial regulators to enforce stricter compliance, warning that banks, fintechs, and microfinance institutions found to be complicit risk suspension, prosecution, and sanctions.

The EFCC said it would intensify scrutiny of financial institutions, insisting that negligence in monitoring suspicious transactions would no longer be tolerated, as such failures continue to undermine public trust and drain the economy.