Beware of Rising Fraud, Terrorism Financing- CBN to Banks

Central Bank of Nigeria (CBN) has told banks and other financial institutions to be on the look out for increased cybercrimes and well as money laundering and terrorism financing (ML/TF) in the wake of the Covid-19 pandemic.

Mr. Godwin Emefiele, CBN governor

The apex bank said the call is based on an advisory from the  Nigerian Financial Intelligence Unit (NFIU). The regulator in circular to all banks and other financial institutions in the country signed by J.M Gana, CBN director, Financial Policy and Regulation,  said the NFIU had issued an Advisory based on comprehensive analysis of STRs and other information available to it.

“The Advisory identified increased financial crimes such as, cybercrimes, frauds, counterfeiting and substandard goods; diversion of public funds and misuse of Non-Governmental Organisations (NGOs).

“Some vulnerabilities and Red flags highlighted in the Advisory are listed below for your information and necessary action. Changes in the trends of business activities and financial transactions precipitated by COVID-19 pandemic inadvenently led to increase in financial crimes globally.

“This therefore requires financial institutions to adapt rapidly and keep abreast with emerging risks and other developments while taking proactive steps to address the new and emerging ML/TF risks’’.

The apex bank said financial institutions should reportE”e-commerce merchant with little or no history or internet presence, suddenly receiving payments from unrelated third parties.

“lndividual(s) suddenly receiving multiple payments from unrelated third parties. Customers suddenly engaglng in the supply or purchase of medical supplies and payment for goods and services associated with known brands, yet the benehciary is an individual not a corporate body.

“Unusual transactions dynamics from customer(s). Expect to see more transactions for medical supplies. equipment and medication.

“Payment for goods or services  associated with a known brand, yet beneficiary  is an individual not a company.

“Unusual volume of transactions. large and frequent cash withdrawals and deposits. Immediate disbursement of deposited funds to multiple accounts.

“The account signatory also a public/civil servant. Funds transferred from government account to personal account.

“Non-proflt organisations suddenly receiving donations in favor of Covid-19 patients or victims. Customers’ account with little or no activity suddenly receiving funds from one or more unrelated third parties only for the funds to be transferred to one or more unrelated thirds parties.

“NGOs under the guise of paying COVlD-19 victims could actually be paying members of a criminal gang or facilitating terrorism financing

“You are therefore advised to update Alerts protocol in your AMUCFT monitoring tools. In line with the red flags and emerging trends arising from  the COVID-19 related financial crimes.”