GH¢95m recovered from attempted fraud on banks, SDIs

Despite significant efforts to curb financial fraud, the banking and SDI sectors in Ghana experienced an alarming rise in loss values due to fraud in 2023.

However, collaborative measures by financial institutions and stakeholders led to the recovery of GH¢95 million from a total loss of GH¢167 million.

However, this left a net loss of GH¢72 million—a 29% increase compared to the previous year.

GH¢72m stolen in total fraud losses

Though attempted fraud cases in the banking and SDI sectors declined by 59% in 2023, the total loss value associated with successful fraud cases still reached GH¢72 million.

The sharp increase in losses was attributed to large fraud cases involving foreign currencies, which significantly inflated the value in Cedi terms.

GH¢63m stolen from banks

Banks in Ghana recorded a total fraud loss of GH¢63 million in 2023, showing a 21% increase from the GH¢52 million recorded in 2022. Fraud types such as cash theft (cash suppression), cyber/email fraud, and ATM/POS/Card fraud were responsible for the majority of these losses.

Cash theft, in particular, surged to GH¢14.8 million—a dramatic rise from the GH¢1 million recorded in the previous year.

GH¢8.7m stolen from SDIs

The SDI sector recorded a total loss of approximately GH¢8.7 million due to fraud in 2023.

This represents a near doubling (98%) of the loss value from 2022, driven by fraudulent withdrawals and e-money fraud.

Fraudulent withdrawals, for example, saw a significant rise, with losses amounting to GH¢4.6 million compared to just GH¢0.17 million the previous year.

ATM/POS/Card Fraud Rises as Digital Channels Expand

One of the most notable trends in 2023 was the surge in ATM/POS/Card fraud, which recorded 218 cases, a sharp jump from only 9 cases in 2022.

The increased use of digital payment channels has exposed more vulnerabilities, prompting the need for enhanced security measures by financial institutions.

SIM swap fraud also emerged as a growing concern, with 15 cases reported during the year.

Calls for improved fraud prevention measures

The Bank of Ghana (BoG) has urged financial institutions to bolster security features in their electronic banking systems.

Banks are encouraged to adopt multi-factor authentication, update mobile banking applications with biometric security, and deactivate auto-login features to prevent unauthorized access.

Strict adherence to Know-Your-Customer (KYC) procedures is also vital in safeguarding transaction verification processes.

Collaboration with law enforcement

The BoG has strengthened its collaboration with law enforcement agencies to tackle fraud more effectively. Workshops, like the Committee for Cooperation between Law Enforcement Agencies and the Banking Community (COCLAB) hosted in 2024, are part of the ongoing strategy to map out effective measures against fraud in the digital financial environment.

Banks and SDIs are urged to work closely with law enforcement to ensure stricter penalties for employees involved in fraudulent activities.

PSPs urged to comply with regulatory measures

Payment Service Providers (PSPs) have been urged to comply with Section 34 (3) (a) and (b) of the Payment Systems and Services Act 2019 (Act 987), which mandates PSPs to deactivate electronic money accounts for two days when customers swap or replace SIM cards.

PSPs should also adopt robust fraud prevention programs, deploy Ghana Card verification systems, and ensure thorough screening of agents to minimize SIM swap-related fraud.

Strengthening security and customer awareness

The financial sector must take a proactive stance to combat the increasing complexity of fraud schemes.

Banks, SDIs, and PSPs need to continuously upgrade their security technologies, prioritize employee training, and educate customers on fraud risks.

Only through enhanced security measures, diligent monitoring, and collaboration with relevant stakeholders can Ghana’s financial institutions protect themselves and their customers from the growing threat of fraud.