The Nation Newspaper

Tag: fraud

  • Banks lose N159bn to fraud

    Banks lose N159bn to fraud

    •CBN steps up efforts to stem fraud

    The Central Bank of Nigeria (CBN) has set machinery in motion to help the banks tide over the increasing loss of funds as a result of poor electronic payment system.
    Available statistics show that Nigerian banks have lost a whooping N159 billion to electronic fraud between 2000 and first quarter (Q1) of 2013.
    To address this malaise, the CBN has disclosed plans to reposition Payments System Policy and Oversight Office in order to be more responsive to challenges and realities of today.
    The apex bank is also looking to evolve appropriate policies and regulation to proactively tackle electronic fraud in the country.
    Speaking at the 4th Annual Payment System and Fraud Conference organised by the Electronic Payment Providers Association of Nigeria (E-PPAN) in Lagos, recently, Tunde Lemo, deputy governor, operations, CBN, said the cashless economy scheme has continued to make appreciable progress within the context of the peculiarity of Nigerian business environment. According to Lemo electronic fraud has become a significant snag of the success of the cashless initiative, further adding that the apex bank is constantly devising innovative ways of curbing the menace.
    Christabel Onyejekwe, executive director, business development, Nigerian Inter-Bank Settlements Systems, (NIBSS) plc, said the huge losses to e-fraud is a deterrent to improving the consumer confidence and adoption of Nigeria’s cashless strategies. Onyejekwe quoted recent research data on e-fraud in Nigeria by the Financial Institutions Training Centre (FITC).
    Analysing the annual e-fraud trend in the banking industry since 2000 till date, Onyejekwe, in an interview, said that the figure stood at N1.65 billion in 2000; N3.12 billion in 2001; N8.20 billion in 2002, but declined to N5.13 billion in 2003 while in 2004, the figure moved up to N89.43 billion.

  • Alleged fraud: Court rules on ex-commissioner‘s application Friday

    A Federal High Court, Lagos, on Tuesday fixed Friday for ruling on the bail application filed by a former Oyo State Commissioner, Kazeem Adedeji.

    Adedeji and his co-accused – Yinka Fatoki and Kolawole Adewole, were returned to Ikoyi Prisons by Justice Chukwujekwu Aneke, after the defence counsel, Olabode Iranloye, moved his application for bail.

    The accused persons were arraigned last week for allegedly defrauding the state government of N77 million.
    Although the prosecuting counsel, Effiong Asuquo, from the Special Fraud Unit, was not in court, Aneke ordered the defense counsel who had claimed that he saw Asuquo in the premises to move his bail application.
    When the matter was called up, the judge asked the defense lawyer to call Asuquo but the former came back and told the court that the prosecutor said he had another matter before another judge.
    Aneke had stood down the case and after taking three other matters, sent the defense counsel again to call the prosecutor.
    However, Iranloye returned and told the court the prosecutor said he was not coming because he was filing court papers for another matter.
    He said: “It is an insult that my learned friend said he could not appear before your lordship because he has another case in another court. The most painful thing is that he is even a member of the Bar.”
    Angered by Asuquo’s response, Aneke ordered the defense counsel to move his application.
    Irinloye while moving the application for the accused bail urged the court to give liberal conditions. He prayed the court to grant Adedeji bail on self recognition as a former commissioner.
  • N270m fraud: ‘Ajudua doesn’t deserve fresh bail’

    N270m fraud: ‘Ajudua doesn’t deserve fresh bail’

    The Economic and Financial Crimes Commission (EFCC) yesterday filed a notice of appeal against the ruling of a Lagos High Court, which granted bail to suspected fraudster, Fred Ajudua.

    Ajudua and Charles Orie are on trial for allegedly defrauding two Dutch businessmen of N270 million.

    Worried that Ajudua had frustrated his trial for seven years, the EFCC raised an objection to the defendant’s bail application on the grounds of failing health.

    But when the courts were on vacation, Justice Ganiyu Safari granted Ajudua bail for N50 million with two sureties to enable the defendant attend to his health.

    Dissatisfied by the ruling, the EFCC, in its notice of appeal, insisted that Ajudua did not deserve to be on bail.

    Signed by Oluwafifehan Ogunde, the notice stated that Ajudua, being a socialite, might interfere with prosecution witnesses.

    EFCC argued that the accused did not present any compelling medical report to warrant the decision of the court in his favour.

    Also, the substantive case before Justice Joseph Oyewole was yesterday adjourned till October 2, following disagreements between the two parties.

    Although Ajudua was absent in court, the second defendant, Orie, was present. But the parties could not reach an amicable agreement.

    Counsel to EFCC, Mrs. A. P. Sanusi, reminded the court that there was a pending motion before it went on vacation, adding that the prosecution was served four applications, filed by the first defendant. Ajudua’s lawyer, Richard Omohomreh, who admitted that he has four applications before the court, stated that the life of his client (Ajudua) was still in danger at the hospital.

  • Police arraign couple for visa scam in Edo

    A couple, Abdulazeez Umar, 50 and Hajiya Fatima Umar, 48, were on Wednesday arraigned at an Auchi Chief Magistrates’ Court for an alleged visa scam.

    The couple, facing a 13-count charge, allegedly collected N1 million from a woman, Princess Zainab Alamah, to get a Saudi Arabian visa for her.

    Some of the charges against them are conspiracy, felony, obtaining money under pretense, stealing and fraud.

    The couple pleaded not guilty to the charges.

    The prosecutor, Cpl. Andrew Edmond, told the court that the accused persons allegedly collected the money from one Princess Zainab Alamah between June and October 2011.

    “My lord, this couple collected the money at different times to assist Alamah to procure document for her to attend the 2011 Muslim pilgrimage.

    “The  accused persons fraudulently and unlawfully converted the money to their personal use, without processing the visa as promised,’’ he said.

    The prosecutor said the offence contravened the Criminal Code of the defunct Bendel State 1976, as applicable in Edo.

    The Magistrate, Mrs I.A. Osayande, granted the accused persons bail, each for  N100,000 with two sureties in like sum.

    The case was adjourned to Oct. 16 for further hearing. (NAN)

  • EFCC arrests four suspects for alleged N2.05b fraud

    EFCC arrests four suspects for alleged N2.05b fraud

    The Economic and Financial Crimes Commission (EFCC) announced yesterday a major breakthrough in its anti-fraud battle.

    Four suspects, including two bureau de change operators – Salihu Liman Mahmoud and Dan Asabe Ibrahim – have been arrested for alleged N2.05billion fraud.

    The other suspects are two students of the University of Jos (UNIJOS) – Isaiah Friday and Azzaior Samuel.

    According to the EFCC, the suspects invaded Union Bank’s database and manipulated it to steal N2.05billon.

    The commission said it recovered N475.3million from the suspects.

    Other items recovered include furniture worth N10 million from Mahmoud’s one-bedroom apartment in Yaba, Lagos Mainland; four vehicles; landed properties in Kano and Kaduna and a four-bedroom duplex worth N45 million in Lagos

    According to a statement by the Head of Media and Publicity of the EFCC, Mr. Wilson Uwujaren, the suspects specialise in breaking into computer data of banks.

    It said their arrest followed a report by Union Bank of Nigeria, Plc.

    The statement said: “The fraudsters, who specialise in breaking into the computer data base of financial institutions in order to carry out dry posting of funds, were arrested in Lagos and Jos.

    “ Their arrest came on the heels of a petition which the Commission received from Union Bank of Nigeria Plc, Marina, Lagos sometime in January 2013, alleging that a criminal attack had been launched on its data base known as “Flexcube”, by unknown criminals.

    “The criminals falsified the bank records and accounts and created unjustified huge opening balances in several accounts across the bank’s branches and subsequently transferred funds from those accounts to several accounts in other banks.

    “The petition, which was signed by A.F Olufade, Head of Fraud Investigation at the bank, said cash withdrawals and electronic transfers totalling over N2.05billion was involved in the scam.”

    The commission said one of the suspects, Isaiah Friday, who is a computer maintenance artisan, coordinated the scam.

    The statement added: “Upon receiving the petition, the Commission’s Banks and Other Financial Institutions Fraud section swung into action.”

    Investigations by the commission, however, revealed that Friday, who was carrying out computer system maintenance services for one of Union Bank branches in Jos on a part-time basis, paved the way for the fraudsters to penetrate the bank’s database. Friday was traced and arrested. His arrest led to the arrest of Azaaior Samuel.

    “Investigations further revealed that Mahmoud, who is the mastermind of the fraud with others now at large, had approached Samuel if he knew anyone working with the Union Bank. Samuel gave Friday’s contact and Friday was contacted.

    “They told him they needed access to the bank’s database in order to carry out some postings. They promised to give Friday N1, 500,000 if the deal succeeded. Friday obliged and on the day the crime was committed, Samuel disguised as a colleague of Friday who had accompanied him to work in order to gain access to the bank’s premises. They carried out the postings to six different company accounts domiciled in Union Bank’s Marina branch in Lagos.

    “The accounts are: Gona Bureau De Change Limited, Jaxmine Bureau De Change Limited, Dan Kawu Bureau De Change Limited, Godswill Great Communications, ZHG Services Limited and A and B Console Limited.

    “The postings were carried out and the syndicate thereafter went to the bank to draw all the funds. Friday was paid as promised and other syndicate members now at large shared the remaining balance.”

    The EFCC said it had so far recovered N475,326,720 from the suspects, including $2,129,900 and N134,542,720.

    The statement added: “Other items recovered include: furniture worth N10 million from Salihu Liman’s one-bedroom apartment in Yaba, Lagos, four vehicles, landed properties in Kano and Kaduna and a four-bedroom duplex worth N45 million in Lagos.

    “Investigation into the scam continues.”

  • Ex-presidential candidate accused of fraud

    Ex-presidential candidate accused of fraud

    A Federal High Court sitting in Port Harcourt, the Rivers State capital, yesterday granted bail to the former presidential candidate of the Hope Democratic Party (HDP) in the 2011 general elections.

    Ambrose Owuru was granted bail in the sum of N10 million.

    He is being tried by the Economic and Financial Crimes Commission (EFCC) for allegedly defrauding Mr. Ikechukwu Eze of N66 million in Port Harcourt in 2011.

    Mr. Justice Aliyu Sulaiman said Owuru must provide one surety, who must be a lawyer with not less than 20 years experience.

    He said the surety must present a sworn affidavit of means and the accused must sign an undertaking to be present in court during the trial.

    Mr. Justice Sulaiman also ordered that the accused be remanded in EFCC’s custody pending the fulfilment of his bail conditions.

    His lawyer, Granville Abibor (SAN), hailed the court’s decision.

    Said he: “The court granted bail in the sum of N10 million. This is fair, considering that the subject matter relates to N66 million.”

    Owuru, through Abibor, urged the court to grant him bail on self-recognisance, being a practising lawyer of about 30 years, having been called to the Bar in 1984; and a vibrant politician.

    Speaking to reporters at the court, Owuru, the founder of HDP, denied the allegation levelled against him.

    He said the case was already ongoing in a High Court in Port Harcourt.

    He accused the EFCC of acting the script of his political opponents to tarnish his image ahead of the 2015 general elections.

    Moving the motion for bail, Abibor said the charges against the accused were bailable and that bail was the right of a person charged with a criminal offence to enable him prepare for trial.

    Said he: “Bail before trial is a basic right of the accused to enable him prepare for trial, especially when the offence is bailable.

    “The five-count charge for which he is being tried are offences bordering on fraud, forgery and alteration. They are bailable offences.

    “The prosecution, in their 19-paragraph counter-affidavit, did not oppose the bail of the accused, neither did they say he had committed any offence and intended to commit any if admitted to bail.

    “He is a very senior lawyer, having been called to the Bar in 1984, and a practising politician, who has contested presidential elections twice.

    “The essence of bail is to secure the attendance in court of the accused for trial and not for punishment.

    “The accused has been in detention since July 31 when he was arrested. If it is embarrassment, punishment, disgrace, he has experienced them. Yet, trial has not started.”

     

  • Council chief denies fraud allegation

    The Chairman, Ojodu Local Council Development Area (LCDA) of Lagos State, Julius Oloro has denied allegations of corruption and high-handedness levelled against him by a group, Agenda for Good Governance (AGG).

    The Chairman said there was no truth in the allegations, describing them as a design to destroy his person and administration by his political opponents.

    “I know where these allegations are coming from, there is no truth in all the allegations and my administration has been open and transparent in all we have done. I have invited the general public to come to Ojodu to verify if there is any substance in what my critics are saying before they judge me guilty or innocent,” Oloro said.

    In a widely circulated report, the AGG accused Oloro of financial recklessness, gross incompetence, disrespect to party leaders and physically assaulting two workers of the council Deji Ogunlana and Wale Olusesi.

    In a swift response, Oloro said the allegations were “wicked fabrications by my detractors”, who are bent on destabilising the peace of the local government.

    ” I know the two people they alleged I assaulted, please you need to also ask them if there is any iota of truth in the allegations that I beat them up. They will testify whether it is true or not. I do not understand why people will go to this extent to destroy another person. My administration is open and transparent, I have hidden nothing from anybody, my priority is to do the work Ojodu people have given to me and they are the ones who can judge my performance,” Oloro said.

    He said the empowerment of the youth in his council was of paramount importance adding that is why his administration initiated some empowerment programmes on coming to office in October 2012.

    “Today, we are empowering 40 people in our local council with the sum of N10, 000 each. This is to enable them engage in small scale trading. We discovered that there are people who can start businesses with as little as N2, 000. So we thought if they could do that, we should provide the sum of N10,000 and after six months we will evaluate the success of this project and know the way forward,” he said.

    He said his council engaged youths positively through skill acquisition and sports through the ‘Oloro Football Tournament’. ” In the area of education we have encouraged our teachers through the provision of teaching materials. As you know the winner of Spelling Bee competition is from our council and even the second prize winner who is a Primary six student.”

    The winner Boadley JuwonAfolarin is a Senior Secondary(SS2) pupil of Omole Grammar School while the second prize winner is 10 year old, Olayinka Ogunenika, a primary six student of Estate Nursery &Pry School, Oke-Ira.

  • How N1.1b subsidy fraud was committed, by witness

    Three oil marketers – Abdullahi Alao, Opeyemi Ajuyah and Olarenwaju Olalusi – were yesterday alleged to have forged the documents with which they committed N1.1 billion fuel subsidy fraud.

    A prosecution witness, Mr. Mohammed Adedapo, made the allegation when he testified at the resumed trial of the marketers before Justice Lateefat Okunnu of a Lagos State High Court, Ikeja.

    The marketers and their firms – Axenergy Limited and Majope Investment Limited – were charged to court by the Economic and Financial Crimes Commission (EFCC) over alleged subsidy fraud.

    Adedapo, who is an inspector of petroleum products of Q and Q Control Marine Services Nigeria Limited, told the court that Alao, the son of Ibadan business mogul, Aare Abdulazeez Alao-Arisekola, and other defendants, allegedly obtained subsidy for 15,000 metric tonnes of petroleum products, instead of the 4,000 metric tonnes of petroleum products they imported.

    The witness said the discharge was done at Lister Jetty, Apapa, Lagos, between January 22 and 23, 2011.

    Led in evidence by EFCC counsel, Mr Francis Usani, the witness said Q and Q was contracted by Oando Oil and Gas Plc to inspect the quantity of products brought in by a vessel, MT Brief, on behalf of Majope Investment Limited.

    Adedapo said the vessel, which brought the petroleum products allegedly discharged only about 4,000 metric tonnes into the facility while it took away the remaining.

    The witness added that following the discrepancy discovered in the transaction, he wrote a protest letter to the captain of the ship and stated the fact of the transaction.

    Adedapo said he issued a Shore Tank Certificate to the marketers, stating that only 4,000 metric tonnes of petroleum products were discharged.

    Following the testimony, Falana urged him to sign on a blank paper to compare the signatures. They were admitted as Exhibit P6 by the court.

    Justice Okunnu adjourned the matter till July 24 for the continuation of the trial.

    During cross-examination by the defendants’ counsel, Mr Wale Akoni (SAN) and Mr Oludare Falana, the witness said he did not sign any document indicating that 15,000 metric tonnes of fuel were discharged.

    “The Shore Tank Certificate, showing 15,000 metric tonnes, was not signed by me. The signature looks like mine but this document did not emanate from Q and Q,” Adedapo added.

  • Senate probes $27m ‘fraud’ in Nigerian Embassy

    Senate probes $27m ‘fraud’ in Nigerian Embassy

    The Senate yesterday began a probe of the alleged sale of some Federal Government’s prime properties in the United States of America valued at $27 million.

    The cash was said to have been embezzled by Nigerian Embassy officials in the US.

    The fund was realised from the sale of “four prime properties in Washington DC and Maryland.”

    The allegations are contained in a petition sent to Senate President David Mark by Daniel Elombah on behalf of Transform Nigeria Citizen Initiative, a non-government organisation (NGO).

    Mark directed his Chief of Staff, Senator Anthony Manzo, to refer the petition to the Chairman, Senate Committee on Foreign Affairs, Senator Matthew Nwagwu, for action.

    Nwagwu, who opened the investigation of the matter yesterday, invited Dr. George Obiozor, Nigerian Ambassador to the US from 2004 to 2007; Prof. Joy Ogwu, current Nigerian Representative to the United Nations and former Minister of Foreign Affairs, 2006 to 2007 and Ambassador Ade Adefuye, current Nigerian Ambassador to the US, who resumed duty in October 2010 for interaction.

    Before the investigation moved into a closed door session, Nwagwu said there were allegations of embezzlement of funds in Washington, in particular the sale of properties in the US.

    He said it was alleged that the resources were squandered by Nigerian Embassy officials in the US.

    Nwagwu said: “Ours is to give you a chance to address the committee, to tell us what you know about the administration and management of the funds within your tenure from 2004 to date.

    “There is a petition before the committee on the issue. We have the petition and we are taking it on the face value.

    “We are giving this opportunity to the Minister and Ambassador to explain what happened.

    “We are not a court of law and you are not on trial. We just want to keep the record straight.”

    In the letter to Mark, entitled: ‘Petition concerning misappropriation and embezzlement of funds by the Nigerian Ambassador to the United States and others,’ the petitioner requested Mark to investigate what happened to the funds realised from the sale of certain properties of the Nigerian government in the United States between 2004 and 2007.

    It said available records showed that between 2004 and 2007, Nigerian Embassy sold four prime properties of the Nigerian government located in Washington DC and Maryland.

    The Embassy, it said, also began the sale of a fifth property in San Francisco, California.

    It said: “For the sale of those properties, Nigerian government retained the services of ECULAW law firm.

    “Of those sales, Nigeria realised approximately $27 million.

    “Funds realised from these sales, except those set aside as fees, were remitted to the Nigerian Embassy in Washington DC.

    “As at June 2007, when the Law firm that advised the Embassy on the sale of the properties met the Embassy officials on the Embassy premises in Washington, all these funds and transactions were duly confirmed.

    “On that occasion, it was also confirmed that the Nigerian Embassy had placed the funds in a special account with M&T Bank in Washington DC.

    “M&T Bank had been the bank the Embassy used for other transactions and had about three accounts with that bank.

    “It was confirmed in clear terms that their bank was holding huge deposits comprising the proceeds of the sale of these properties.

    “This remained the position after Ambassador Obiozor had returned to Nigeria upon completing his service in Washington.

    “Those huge funds were lodged in Washington rather than being remitted to Nigeria.

    “Any honest observer of these events would suppose it would be only a short period of time pending a brief protocol necessary for the remittance of those funds to the Nigerian treasury.

    “However, and surprisingly, the Nigerian Embassy left that money in Washington partly because it yielded substantial monthly interests, which the Embassy officials would never have to account for.

    “The funds remained in those account throughout the tenure of Ambassador Oluwole Rotimi.

    “Then arrived Ambassador Adebowale Adefuye in Washington.

    “When Adefuye got to Washington, the funds were still lodged in the M&T Bank account intact.

    “Between the time Adefuye became the Ambassador until March, 2012, the millions in the account mysteriously disappeared.

    “This became clear when the M&T Bank was forced to close the bank accounts of Nigerian Embassy and terminate all banking relations with the Embassy at the beginning of 2012.

    “In the correspondence between the bank and the Embassy, which were made public, it became clear that the accounts of the Embassy with M7T Bank, including the one containing the proceeds of the sale of the Embassy properties had been drawn down to barely $400,000.”

    The petition claimed that since March 2012, there has not been any explanation of what happened to the millions of dollars realised from the sale of the Embassy properties in the US, which were in the bank account at the time Ambassador Adefuye assumed office.

    He said it was time to focus on the truth about the missing money.

    He noted that the least the government should do is to come out and explain to Nigerians what happened to the funds.

  • Why bank fraud persists, by police chief

    Failure of banks and other financial institutions to follow due process in employing their staff is the root cause of frauds in the sector, Commissioner of Police in charge of the Special Fraud Unit (SFU), Ikoyi, Lagos, Mr Tunde Ogunsakin, said yesterday.

    He said that the financial institution’s carelessness in properly screening applicants before employment often results in insiders’ connection in most fraud cases that had been investigated by his unit.

    Ogunsakin, who spoke on current trends in bank fraud, said: “In recent times, Electronic Banking Fraud has taken the lead in all manners of bank frauds in Nigeria. The reason for this can hardly be far-fetched. In a world where Information Technology has become a veritable foundation of modern- day-banking in a cashless environment, it is quite natural for fraudsters to devise their own criminal means and motives to circumvent the system.

    “The ambivalence of measures put in place by government regulators for the commercial banks/players to guarantee security of access and terminals which provide tools for e-products delivery notwithstanding, the fraudsters are always relentless to thwart these efforts. This fact is underpinned by regularly reported cases at the Police Special Fraud Unit involving frauds perpetrated through Automated Teller Machines (ATM), Mobile Telephony Banking, Internet Banking, Electronic (Wire) Instruction Transfer of Funds, Point of Sales (POS) Banking and Credit/Debit Cards Scheme.

    “The commonest among Electronic Banking Fraud is the Money Transfer (Wire) Instruction Schemes, where either the bank customers account passwords are either stolen or hacked into, or where the security pass codes of bank officials are compromised through the bank’s electronic platform, which is then illegally intruded upon by fraudsters.”

    He gave other factors as inordinate tolerance for corruption among public and private agencies; deteriorating quality of graduates in terms of professional value and ethics; chronic unemployment among graduates; weakness of the existing legislative/judicial institutions to make and enforce relevant laws on cyber crimes; inadequate training; poor recruitment policies; increasing and changing sophistication in technological equipment; and weak internal control of banking system.

    The police chief noted that to reduce the spate of bank frauds in general, commercial banks must strictly adhere to the guidelines on Electronic Banking in Nigeria (August 2003) issued by the Central Bank of Nigeria (CBN).

    He added that the cashless economy has graciously checkmated unwholesome cash circulation particularly in Lagos and other major commercial cities.

    Ogunsakin listed some of SFU’s challenges as lack of well- equipped forensic laboratories; data base of criminals, inadequate legislation; cost of investigation; inadequate working tools; inadequate collaboration with private sector; and inadequate international collaborative framework among others