The Bank of Ghana (BoG) has explained that the evolving global financial landscape and the growing utilisation of digital platforms have increased risks in the banking sector and as such put combating financial fraud in focus.
According to the central bank, fraudsters are continuously developing sophisticated techniques and exploring vulnerabilities in the financial system to take advantage of unsuspecting customers, necessitating a proactive and comprehensive approach to combating fraud in the banking system.
The BoG said that as part of its role in regulating and supervising the banking and payment systems, it assesses fraud typologies and trends across banks, Savings and Deposit Taking Institutions (SDIs) and Payment Service Providers (PSPs).
To execute this role, the BoG said it collects data on attempted and successful fraud incidents in accountable institutions and publishes the annual fraud reports.
“It is therefore mandatory for all banks, SDIs and PSPs to report fraud cases to the BoG as and when it happen and submit a monthly ‘Nil return’ when no fraud is recorded. These reports provide an insight on fraudsters’ modus operandi, fraud typologies and trends while highlighting measures to mitigate fraud activities,” the BoG said in a report.
It added that “The negative impact of fraud in the banking sector is not limited to financial losses but also the significant reputational risks posed to financial institutions and loss of public trust in the banking sector.
This reinforces the need for financial institutions to enhance internal controls, employee training and customer financial literacy schemes. The BOG remains committed to enhancing collaboration, engaging
stakeholders and implementing regulatory measures to mitigate risks associated with fraud and fraudulent activities to safeguard financial stability in Ghana.”
The report by the Bank of Ghana revealed that in 2024, banks reported a total count of 716 fraud cases.
This indicates a 26% drop from the count of 969 cases in 2023.
According to the report, this downward trend in fraud cases can be attributed to the improvement of internal controls within the banking sector.
The data obtained from the industry showed improvement within the bank and SDI sectors.
The report said although banks and SDIs showed a decline in the number of cases reported in 2024 as compared to 2023, the count of fraud in the Payment Service Providers (PSP) sector increased in 2024.
The data also shows a decline in the value at risk of the Specialised Deposit-Taking Institutions (SDI) sector in 2024 as compared to 2023.
Overall, the aggregate data collated from the 1three sub-sectors indicate that, the count of fraud cases increased to 16,733 in 2024 from 15,865 in 2023, reflecting a 5% rise. These cases correspond to total value at risk of approximately Gh¢99 million in 2024 as compared to Gh¢88 million in 2023, indicating an increase of 13%.
The attempted fraud cases in banks and SDI sectors decreased by 18% in 2024 as compared to 2023. However, this resulted in an 11% increase in the total value at risk associated with these cases in 2024, relative to 2023. The total values at risk stood at approximately GH¢80 million and GH¢72 million in 2024 and 2023 respectively. Notably, the total values at risk recorded across all fraud types declined in 2024, with the exception of forgery and manipulation of documents, which increased 7-fold compared to the 2023 figure of GH¢7.47 million. This fraud type also accounted for 67% of the total value at risk recorded for banks and SDIs in 2024.
The rate of recovery of potential losses has become a challenge for banks and SDIs due to prolonged legal proceedings that eventually lead these institutions to stop pursuing the cases.
The PSP sector also recorded a value at risk of GH¢19 million involving 15,673 cases in 2024. In percentage terms, the value at risk and number of cases increased by 18% and 7% respectively from figures recorded in 2023.
