THE CAUSES AND PREVENTION OF FRAUD IN BANKING INDUSTRY

CHAPTER ONE

INTRODUCTION

The banking industry is yet in its formative stage in Nigeria.  No country whether developed  or developing an afford to over look the directions its banking institution live in their development especial when we consider the unique position of the industry in the pace and direction of economic growth of the nature.  There arise a need therefore of state emphatically that the soundness of the individual bark in economy is an infinite asset which act as a dynamic factor of growth to the general economy. The role of financial institution  in facilitating the process of intermediation form surplus economic unit to defect economic and unit become paramount intermediation is the ole the financial institution encounter varies problem in fraud.  It is assumed that an alarming proportion that there is no feasible sign near future.

Basically it noted that fraud and loss are expected phenomenon of my business activity the scope and gravity are what create concern in the economy.  The stud identifies varies forms and nature of  bank fraud clearing fraud forgeries and falsification of account were the most common forms of fraud identified with 33% of banking institution in the economy respectively factors that facilitate fraudulent practices were also identified.  These range form the socio economic factors to weak internal control system.  This is effort undermines the operation and performance of banks and could be disastrous if there are not curbed.

1.1     BACKGROUND TO THE STUDY    

Fraud is a social evil it affect the entire sector of the economy which banking system is inclusive although fraud and loss in an expected part of any business activity the scope and gravity is what creates concern in a developing economy like ours. Fraud in banking sector is generally looked at as acts that involve the loss of asset a through deceitful and dishonest means.  It  certainly constitutes one of the most serious threat to the practice and spread of banking in Nigeria fraud and forgeries involved professional crooks that  are seek to enlist the support and co-operation of   the dishonest members of the bank staff.

In pursuit of the objective of the study a systematic approach will be followed. The study is divided into four chapter. Chapter one takes a look at its introduction background of the study the statement of problems purpose objective  of the study significance of study limitation of study and definition of terms chapter two deals with the literature review “general view” types of fraud causes of fraud element that facilitates fraud .  chapter three concentrates on design and methodology sources of data location of data and tools of analysis chapter four comment on findings of the effect and the recommendation against fraud action to be taken to ameliorate the harm done to the bank summary and conclusion will mark the end of their study.

1.2  STATEMENT OF PROBLEM

Generally speaking professional fraud is new not just because it exposes the societies anemone and raise important questions of public interest which follows this 1.2.1Fraud is banks nearly leads to lose of money ordinarily belongs to some one other than the bank. 1.2.2In every bad conditions where fraud occurs with crippling frequency and in wholesale sizes the bank may be forced to liquidate consequently and drastic reduction of patronage in the banking sectors. 1.2.3The effect of fraud equally dastards management policy to encompass cheek and control system which are by them costly to maintain. 1.2.4Bankers as a matter of urgency  are expected to be very careful in the  detection for costing and prevention of fraud to help cub and cushion the effect of the menace.

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