Regulators Mull Clampdown on Accounts, GSM Phones Used for Fraud

Central Bank of Nigeria (CBN) and the Nigerian Communications Commission (NCC) may soon introduce a scheme that will enable banks and telecommunications companies to ban owners of any bank account or the Global System for Mobile Communications line traced to fraud.

The CBN, NCC is reportedly working with the Nigeria Deposit Insurance Corporation (NDIC) following the spate of electronic fraud involving (USSD banking) telephone lines and Internet banking transfers.

When introduced, owners of any bank account or GSM line traced to any fraud case, especially electronic fraud, would be banned for life from operating any bank account or GSM in Nigeria.

The pervasive electronic banking fraud in the banking sector has left customers, banks and regulators waxing worriedly.

Some experts claimed that the most significant risks to banks are self-serving or criminal acts carried out by some insiders.

According to them, when these insiders use their technical knowledge to alter or disable security controls, it can be even more difficult to detect abuse.

But it becomes more dangerous when insiders conspire with criminals outside, showing that depositors money in the banks are not safe.

For instance, fraudsters now inundate banks’ customers with SMSes to authenticate accounts with banks.

The preciseness of the messages with accompanying data show they could only have gotten the details from insiders in the banks.

Elsewhere, cyber security experts have also  berated telecommunications operators over the prevalence of SIM swap fraud in the country, arguing that such fraud could be possible with an insider in the network operator of the subscriber that is targeted.

SIM swapping is a sophisticated form of fraud and falls under social engineering. Fraudsters will distribute phishing emails, trying to ascertain as much personal information from victims as possible.