The driving force of the contemporary banking operation is electronic platform, as it makes banking easier and comfortable. As a result of this, the emergence of Automated Tellers’ Machine (ATM) has reduced queues in the banking hall, by taking banking services closer to the people. But as useful as this online platform is, scammers are always on the prowl for ATM users, hence the need to take precautions. NIYI OLAOYE writes.
The Automated Teller Machines (ATMs) remains one of the greatest innovations the sector has come up with in recent times. Besides enhancing the banking experience for customers and decongesting banking halls, one of the greatest issues concerning the technology which stakeholders have had to grapple with in recent times is its vulnerability.
But sadly, the ATMs have now become cash cows for online fraudsters and several millions of dollars are being lost to scams via the technology on a daily basis. In recent times, card frauds are being committed on an industrial scale.
A report by the Central Bank of Nigeria (CBN) last year disclosed that in 2013 alone in Nigeria, N40 billion was lost to Automated Technology Machine-related scams.
“These online fraudsters seem a step ahead of the law. They keep on innovating and coming up with different methods, hitherto unknown, to ensure that unsuspecting customers are fleeced of their hard-earned funds via the machine,” noted Abiodun Sally, a computer scientist with an Ikeja-based computer company.
Business247 Online News recently reported that the gap between the 2013 and 2015 records on e-money transactional fraud grew high which may put many financial avenues and instrument in danger.
More so, with the adequate protective devices not been put in place to contain these scourge which bankers and financial analysts believe to have become a new business for youths who have perfected e-crime will shot the rate high in 2016.
Financial analysts also note that the sporadic creation of more money market products and services, with special emphasis on mobile funds, would add to the existing danger, especially where unemployed youth population has dramatically increased in the last eight years.
The statistics released by the Nigerian Interbank Settlement Systems Electronic Funds Transfer, the discovery portends a great danger to the new financial experiment and harbours a trend that would erode the efforts the various institutions have made over the years to change the face of financial transactions in Nigeria.
According to the agency, over N6.2 billion was lost to fraudsters in 2014 as against N485 million in 2013. Transactions that went through the Internet banking were so much exposed as Internet is responsible for the highest risk to its users, followed closely by web applications and then the ATM.
Fraud through POS, mobile and cheques are low, indicating that many people are gradually embracing the fastest means of conducting financial transactions, which incidentally have become very risky avenues as 78 per cent of the entire losses were conducted through the three most popular e-money channels.
It is interesting to note that this issue is not peculiar to Nigeria, but rather a global trend. For instance, a new method being used by ATM fraudsters in the United Kingdom (UK) was recently uncovered by the police in the country, thereby confirming the fears in most quarters that ATM-related frauds are fast becoming a festering sore stakeholders are increasingly finding difficult to heal.
According to the report, mobile phone cameras are being hidden in ATMs to enable fraudsters clone the ATM cards of unsuspecting users of such machines. The device, the report says, is hidden under a false panel that matches front of cash point and another placed over card slot to trap or clone the card with the thieves loitering around the place to pounce on the machine after the user must have completed his transaction on the machine. Two fraudsters, who had been feeding fat on this, were last week reported by the a foreign television station as being arrested and jailed by the relevant court in the UK last year, with the police confirming a three per cent rise ( £29 million) of stolen or lost cards incidents in 2014.
But with this new trend on the global financial space, the questions on the lips of stakeholders are: How immune is Nigeria’s banking space against this latest ATM ‘scourge’? How equipped are our financial institutions for such levels of sophistication? Besides, does the Nigerian banking public have the sophistication to quickly discern a situation that constitutes a risk to their ATM transactions?
Mr. Adejumoh Adeoye, computer software specialist, suggested that the issue should not be treated with kid’s glove since it is not impossible to have such scams here.
“We’ve been having similar ones here; it is just for them (the fraudsters) here to update their knowledge on how it is being done there and the way to go about it here. It will definitely happen here, if it has not yet happened. The way out is for banks and their customers to be wary of this form of fraud and be more careful while at any ATM spot. My fear is whether the society here has that capacity to quickly act on such things and avert them,” he said.
But, Chief Executive Officer, Wealthgate Advisor, Mr. Biyi Adesuyi, would not see this as a new development. Adesuyi, whose banking career spanned more than two decades with one of the nation’s frontline banks, stated that the nation’s financial institutions had even started taking measures to nip such scams in the bud.
“Some banks in Nigeria have provided a reliable solution by installing a flat non-transparent object to cover customer’s hand whenever he is pressing the ATM keys. This prevents such a camera from capturing the PIN so pressed,” he explained.
Adesuyi, however, want ATM users to also be more restrained whenever they are on the machine, by using a book or cardboard of reasonable size to cover their hands while imputing their PIN for their funds or accounts to be protected.
Interestingly, Ajayi Omolayole, a marketing communications practitioner, believes the way to go is for stakeholders to take the enlightenment path.
“Let the banks sensitize the public, especially bank customers, to this new trend in ATM frauds. Once the public is adequately informed, the tendency to be caught unawares would be drastically reduced. They would always be wary of all these things while at banking premises,’ he stated.
Interestingly, a common ground among stakeholders is that there is the need to begin to give serious attention to ATM fraud which is fast becoming a festering sore in the global financial space, with many of the firm belief that the time to start doing sensitizing the people on the need to take precaution, while using the platform, is now.
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