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PROJECT TOPIC: FRAUD MANAGEMENT AND THE PERFORMANCE OF FINANCIAL INSTITUTES IN NIGERIA

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CHAPTER ONE

INTRODUCTION

1.1Background to the Study

As in many other industries in the Nigerian economy, most banks are faced with problem of fraud. It might be a gross-over statement to call the Nigerian banking system citadels of frauds. Whilst, very truly, fraudulent practices are rampart in Nigeria the level (amount and number) of fraud is not unexpected of a developing and in experiencing banking system such as ours, it is so far to the credit of the Nigeria monetary authorities, the public at-large and perhaps any other concerned Nigeria that no bank has actually failed in Nigeria as a result of fraud. However, one should be disturbed by the regularity of fraud perpetration in our banks and effort should be made by all and sundry to make this bank to quite a reasonable extent of not totality.

The effect of fraud on our banks are far reacting a high height and they include; huge financial losses of the banks and their customer the depletion of shareholder’s fund and the banks capital base. Others are band management embarrassment and loss of confidence by the customers on our banks. The time, energy and money that would have been used in other development purposes expansion, customers, services and perhaps too, other social responsibilities, to the society-are diverted towards setting up fraud control and prevention system. These automatically increase running cost and most painfully, a major set back at the promotion of banking habit among out people.

Although, the monetary authority and all other concerned have been credited for the simple fact that no bank failed in this country as a result of fraud, it is worth nothing that record has it all, fraud had led to the closure of some banks in other parts of the world and this may take a position of the current trend is not solid. The job matter bank of affairs in great Britain and also the collapse of some banks in Kenya are very good examples, since the rate of occurrence has reached an alarming height and thereby causing a strong and urgent concern there is the need to put a final stop.



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