EFCC Urges Banks to Strengthen Anti-Fraud Measures

In a strong statement addressing the rising concerns about financial fraud in Nigeria, the Economic and Financial Crimes Commission (EFCC) issued a warning to banks and financial institutions, urging them not to become tools for fraudulent practices. The EFCC’s Executive Chairman, Mr. Ola Olukoyede, conveyed this message through his Chief of Staff, Commander CE Michael Nzekwe, during a meeting with the management team of Moniepoint, led by founder and Group CEO Tosin Eniolorunda, on Friday, November 22, 2024. Highlighting the critical role banks play in curbing financial crime, the EFCC called for stronger internal controls and a heightened sense of responsibility among financial institutions.

Mr. Nzekwe noted that financial crimes are often facilitated through the banking system, making it crucial for banks to act as gatekeepers against fraud. “There’s hardly any financial crime that would not go through the financial institutions,” he said, adding that by prioritizing compliance, banks could contribute significantly to Nigeria’s growth. This advisory aligns with the EFCC’s ongoing commitment to tackling money laundering and other forms of financial misconduct that threaten the nation’s economic stability.

Fintechs Urged by EFCC to Strengthen Know Your Customer (KYC) Protocols

The EFCC highlighted concerns about the vulnerability of fintech companies to fraud, especially those serving unbanked and under-served populations. According to Mr. Nzekwe, many fintechs lack robust internal controls, which leaves them susceptible to abuse by criminals. The Executive Chairman underscored the importance of KYC (Know Your Customer) compliance, especially in the opening of tier-one accounts, which often bypass stringent KYC checks and are, therefore, prone to misuse for fraudulent activities.

Mr. Olukoyede advised Moniepoint and similar fintech operators to prioritize improving KYC protocols and avoid becoming a channel for money laundering. “Don’t be a tool; don’t make your system porous,” he said, emphasizing the need for stringent verification measures. He noted that improved KYC compliance could prevent exploitation by bad actors and safeguard the integrity of the financial system. The EFCC remains dedicated to offering support to fintechs in their fight against corruption and fraud, stressing that collaboration is key.

Strengthening Collaboration in the Fight Against Corruption

The EFCC welcomed Moniepoint’s interest in building a collaborative relationship aimed at combating financial crime. Mr. Olukoyede commended the fintech company for its proactive approach to working with the commission, noting that the fight against corruption requires collective effort. He stated, “We value it that you are here today to seek a stronger tie and collaboration,” and expressed optimism that this partnership would lead to improved internal controls within Moniepoint’s operations.

Olukoyede’s remarks underscored the importance of partnerships with stakeholders who can help bridge gaps in the anti-corruption framework. He assured Moniepoint that the EFCC is open to providing necessary support and collaboration. He highlighted that such partnerships send a clear message about a company’s commitment to ethical practices and strengthen the national fight against economic crimes. The EFCC’s mandate of enforcing and investigating financial crimes is bolstered when stakeholders like Moniepoint actively participate in these efforts.

Moniepoint’s Commitment to Combating Financial Crime

Speaking at the event, Tosin Eniolorunda, the founder and Group CEO of Moniepoint, emphasized the challenges and responsibilities his company faces as it expands its services. Eniolorunda stated that Moniepoint has grown to be a significant player in Nigeria’s payment services sector, handling around 70% of the country’s Point-of-Sale (PoS) transactions and transfers. With operations expanding beyond Nigeria to the U.K., Kenya, and Tanzania, Moniepoint recognizes the need for strategic partnerships to navigate the challenges posed by financial fraud.

Eniolorunda affirmed Moniepoint’s commitment to aligning with the EFCC’s anti-fraud initiatives and strengthening its internal mechanisms to prevent misuse. Acknowledging that the nature of their services makes them attractive targets for fraudsters, he expressed a willingness to implement stringent KYC measures and collaborate with the EFCC to address these challenges effectively. This commitment reinforces Moniepoint’s goal of providing secure financial services while supporting the EFCC’s efforts to maintain a safe and fraud-free financial environment in Nigeria.