The Role of ICT in Fraud Detection and Preventions in the Nigeria Banking Industry

The Role of ICT in Fraud Detection and Preventions in the Nigeria Banking Industry

Project / Seminar Material
Reference ID: PS-12065-TM

DEDICATION

This research material titled “The Role of ICT in Fraud Detection and Preventions in the Nigeria Banking Industry” is dedicated to God for his enabling grace, and to all computer enthusiasts who contributed to make life a pleasant experience during my research documentation.

ACKNOWLEDGEMENT

I extend my sincere gratitude to all those who contributed to the completion of this project. Special thanks to my Supervisor (Name of your Supervisor), the Head of Department (Name of your HOD), the Lecturers in the department of Banking and Finance (BF), Book Authors and Profound Scholars of existing or related project material on “The Role of ICT in Fraud Detection and Preventions in the Nigeria Banking Industry” for their invaluable guidance, support, and expertise throughout the journey.

I am also grateful to your study area (mention any funding organizations, if applicable) for their financial assistance. This research would not have been possible without the encouragement and assistance of some stakeholders (mention any mentors, teachers, or colleagues). Additionally, I would like to acknowledge the understanding and patience of my family and friends during this endeavor. Your unwavering support has been a constant source of motivation. Thank you all for being part of this meaningful endeavor.

The Role of ICT in Fraud Detection and Preventions in the Nigeria Banking Industry

TABLE OF CONTENTS

PRELIMINARY PAGES

CHAPTER ONE

Introduction

  • 1.1 Background of the study
  • 1.2 Statement of problems
  • 1.3 Objectives of the study
  • 1.4 Research Hypothesis
  • 1.5 Research Questions
  • 1.6 Significance of the study
  • 1.7 Scope and Limitation of the Study

CHAPTER TWO

Review of Related Literature

  • 2.1 Review of Related Literature
  • 2.2 Types and Causes of Bank Fraud
  • 2.3 Effects of Frauds on Nigeria Banks
  • 2.4 Control of Fraud in Banks
  • 2.5 Concepts of Information and Communication
  • 2.6 ICT and Nigeria Banking Industries
  • 2.7 ICT Infrastructure Used by Banks
  • 2.8 Effects of ICT on Banking Industry

CHAPTER THREE

  • 3.1 Research Methodology and Design
  • 3.2 Population of the Study
  • 3.3 Sample and Sampling Techniques
  • 3.4 Sources of Data
  • 3.4.1 Primary Data
  • 3.4.2 Secondary Data
  • 3.5 Methods for Data Collection
  • 3.6 Procedures for Data Analysis

CHAPTER FOUR

Data Presentation, Analysis and Interpretation

  • 4.1 Data Analysis
  • 4.2 Test of Hypothesis

CHAPTER FIVE

Summary of Finding, Conclusion and Recommendation

  • 5.1 Summary of Findings
  • 5.2 Conclusion
  • 5.3 Recommendation
  • BIBLIOGRAPHY
  • APPENDIX

ABSTRACT

This research essentially focused on the role of ICT in fraud detection in the Nigerian Banking industry. This research work was done through inferential statistics which helped the research to generalize and draw conclusion. The instrument of data used in the process of this research work was questionnaires approach which was subjected to analysis in tabular form. The target population for the research was the banking sector but the accessible population open to researcher was First Bank, Union Zenith, Access banks Anambra whose staff and customer formed the respondents from whom the information obtained were analyzed using X2 statistical tool. The result of revealed that new generation banks in Nigeria were more responsible to modern technology than the old generation banks whose methods of operation were resistant to changes. In addition to this development, the regulatory agencies were not helping matters over their supervising role relating to banking system. The monitory groups of the regulatory agencies were not effective, in the system, leading to flowing of roles and regulations put in place. The government should throw its weight in ensuring that the recapitalization exercise is consolidated by regular monitoring of the operations of the banks to ensure that they operate in line with international best practices.

The Role of ICT in Fraud Detection and Preventions in the Nigeria Banking Industry

CHAPTER ONE

Introduction

1.1 Background Of The Study

Today’s business environment is very dynamic and under goes rapid changes as a result of technological innovation, increased awareness and demands from customers.

Business organization especially the banking industry of the 21st century operators in a complex and competitive environment characterized by these changing conditions and highly unpredictable economic climate information and Communication Technology (ICT) is at the centre of this changes curve. Laudon and Laudon, (1991) contend that managers cannot ignore information system because they play a critical role in contemporary organization. That point that the entire cash flow of most fortune 500 companies is limited to information system.

The application of information and communication Technology concept, techniques, policies and implementation strategies of banking services has become a subject of fundamental importance and concerns to all banks and indeed a prereavisible for local and global competitiveness (ICT) directly affects how managers decides, how they plan and what products and services ware offered in the banking industry. It has continued to change the way banks and their corporate relationship are organized worldwide and the variety of inactive devices available to enhance the speed and quality of services delivery.

Harold and Jaff (1995), contend that financial services provide should modify their traditional operating practices to remain viable in the 1990’s and decades that follows. They claims the most significant shortcoming in the banking industry today is a wide spread failure on the part of senior management is banks to grasp the importance of technology and incorporate it into strategic plans accordingly.

Weherem (2000) claimed that only banks that over haul the whole of the payment and delivery systems and prosper in the new delivery system in order to properly position them within the framework of the dynamism of information and communication technology. The banking industry in Nigeria has witnessed tremendous changes linked with the development in ICT over the years.

The question for survival, global maintenance of existing market share sustainable development has made exploitation of advantages of ICT through the use of automated device imperative in the industry.

This study evaluate the response, of Nigeria banks to this new trend and examines the extent to which they have adopted innorative technologies in their operation and the resultant effects.

1.2 Statements of the Problem

Information and Communication Technology (ICT) is progressively reducing the significance of other factors of production through ICT it is now possible for countries to trade without border restrictions. Therefore as a result of anchoring their operations on (ICT) based delivery system the banks with ICT services have become more profitable.

Though the advantages and opportunities that ICT offers are very great, but this is not without some challenges fraud can likely occur more seriously in financial industry (banking) since large amount may be easier to operate electronically than the manual operation fraudster can beat various security codes through fraud can be greatly minimized, but there could still be some element of dishonest act.

Moreover, another area in which the adoption of information technology has negatively affected the banking sector is the threat it poses for the employees in the sector. According to Jaffer (1968), he ascertained that “unemployment is cyclical phenomenon technological progress may take for short problems of unemployment which rescure time for adjustment because of unmobility of capital and labour.”

According to an official of National Union of Banks, Insurance Finance Institution Employee (NUBIFIE) one of the greatest achievements of the group before the adoption of information technology in banks was the security and guarantee of employment for the members. In the words for Ibrahim (1998), he stated that (ICT) was adopted in bank without any notice without any plan for the future existence of the displaced employees without rehabilitation plan and benefits.

1.3 Objective of the Study

Information and Communication Technology (ICT) increasing, this sort of ICT is vital to the banking industry because it allows holders to do banking online as well as contact customer services support team member from mobile communication devices, or their home computers the objective of the study will be:

  1. To identify possible defects and loopholes (if any) in the banking system
  2. To reveal the need for (ICT) in fraud detection and prevention in Nigeria banking industry.
  3. To reveal the usefulness and consequences of (ICT) to the Nigeria banking system.
  4. To offer useful recommendation based on the findings on how best to prevent the occurrence of fraud through an effective information and communication technology.

1.4 Research Hypothesis

The modern world scientific observations and investigations helps us to eliminate greater risk of uncertainties in this research. There are two (2) major school of thought with three (3) alternatives hypothesis as a trend to solution of this research problem.

  1. H0: The present ICT in the Nigerian banking industry is not effective in fraud detection and prevention.
    Hi: The present ICT in the Nigerian banking industry is effective in fraud detection and prevention.
  2. H0: The present ICT does not proffer possible solution to defects and loopholes in the Nigeria Banking Industry.
    Hi: The present ICT proffer possible solution to defects and loopholes in the Nigeria Banking Industry.
  3. H0: The present ICT does not prevent the occurrence of fraud in Nigeria banking industries.
    Hi: The present ICT does not prevent the occurrence of fraud in Nigeria banking industries.

1.5 Research Questions

In this sub-section, there need to state out research questions to be used in the study of problems. The questions are:

  1. How regular does the ICT check the defects or loopholes in the banking system?
  2. To what extent does fraud occurs in Nigeria banking industries?
  3. To what extent has ICT helped in fraud detection and prevention in banking system.
  4. How regular does the ICT measures the relevance and appropriateness of the adopted control in preventing fraud?

1.6 Significance of the Study

When we talk of significance, we mean the benefits to be derived in researching the case in completion of this study, the following significance will be reasonable.

  1. The result of this study would help to expose the level of fraud in Nigeria commercial banks.
  2. The result of this study would expose the fraudulent staff thereby preventing fraud in the institution.
  3. The outcome of this study would help the financial institution especially First Bank to see the extent of occurrence of fraud in the bank.
  4. The result would also help the bank to access their overall performance through internal control check.
  5. Students carrying out research in similar area can make use of the work
…

CHAPTER TWO

2.0 Literature Review

2.1 Introduction

This chapter focuses on the review of related literature. A literature review includes the current knowledge as well as theoretical and methodological contributions to a particular topic. It documents the state of the art with respect to the topic you are writing. It surveys the literature in the topic selected. In this research work the literature review includes the …

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