The Economic and Financial Crimes Commission (EFCC) has called for the suspension and prosecution of deposit money banks, fintech companies and microfinance banks found to be aiding and abetting fraudsters in defrauding Nigerians through large-scale investment and cryptocurrency scams.
The call was made by the Director of Public Affairs of the commission, Mr. Wilson Uwujaren, in Abuja on the sidelines of a media briefing on negligence and compromise within financial institutions, which he said had cost victims billions of naira.
Uwujaren disclosed that EFCC investigations uncovered widespread compromise in Nigeria’s financial system, involving an N18.7 billion investment scam and fraudulent cryptocurrency transactions valued at N162 billion.
He alleged that one new-generation bank, six fintech firms and several microfinance banks aided fraudsters in laundering illicit proceeds.
According to him, investigations revealed that cryptocurrency transactions worth N162 billion passed through a single new-generation bank without the required due diligence.
He added that a single customer operated as many as 960 accounts in the bank, all of which were allegedly used for fraudulent activities.
Uwujaren said the implicated financial institutions compromised basic banking procedures, enabling fraudsters to convert illicit funds into digital assets and transfer them to safe destinations.
“The commission is calling on regulatory authorities to enforce strict compliance with regulations, particularly in the areas of Know Your Customer (KYC), Customer Due Diligence (CDD) and Suspicious Transaction Reports (STRs),” he said.
He stressed that any deposit money bank, fintech or microfinance bank found to be aiding and abetting fraudsters should be suspended and referred to the EFCC for thorough investigation and possible prosecution.
Uwujaren explained that the N18.7 billion investment scams fell into two categories.
The first involved a syndicate that used an airline discount scheme to defraud victims, while the second centred on a company known as Fred and Farid Investment Limited, also called FF Investment, which lured Nigerians into bogus investment arrangements.
He said the airline scam relied on carefully crafted discount offers for flight tickets of foreign airlines, designed to deceive unsuspecting travellers.
Victims were made to believe that payments were being made directly to airline accounts.
“No sooner had the payment been made than the victim’s entire bank balance was wiped out,” Uwujaren said.
He disclosed that more than 700 victims fell prey to the airline scam, with total losses estimated at N651.1 million.
The EFCC, he added, has so far recovered and returned N33.63 million to victims, while urging Nigerians to be more vigilant.
On the second scheme, Uwujaren said over 200,000 victims were defrauded through FF Investment, with about N18.1 billion generated through nine companies offering various fictitious investment packages.
He further revealed that the schemes were masterminded by foreign nationals, working with three Nigerian accomplices, all of whom have been arrested and charged to court.
