MANAGEMENT OF FRAUD IN THE NIGERIAN COMMERCIAL BANKS. (A SURVEY OF SELECTED BANKS IN NNEWI, ANAMBRA STATE)

CHAPTER ONE

INTRODUCTION

1.1            BACKGROUND OF THE STUDYD

In Nigeria, Bank fraud has assumed a frightening scale and sophistication. The levels in the present day have also grown into epidemic dimension. It has eaten deep into every nerve aspect of our life to the extent that a three years old child talks about 419, (the new discovered sobriquet for an advanced fee fraud) that is shunting us has a nation. The fear is now rife that the increasing wave of fraud in the commercial bank in recent years, if not the commercial banks in recent  years, if not arrested, might pose certain threats to the stability and survival of individual, financial institution and the performance of the industry as  whole.

          For one thing, a fraud result in life financial loses to commercial banks and their customers deposition of shareholder funds and capital base as well as loss of confidence in financial houses.

          For another, the incidence of fraud could in the extreme cases lead to the closure of some badly affected banks as have happened in some parts of the world.

The Demise Bank of credit and commerce international (BCCI) London, and the national Banking of Nigeria, the Morgan finance house in Nnewi are few examples.

          Many of the distressed banks in Nigeria today suffer from fraud and other fraud relates problem, inside credit abuse and indiscipline.

          The extent of fraud in commercial banks rather than that abate has continued to escalate. It is therefore necessary now than ever before that attention is paid to this nefarious international phenomenon as fraudstars become more sophisticated and daring in their approach.

Management of fraud is likened to the management of an ailment.