To curb the alarming menace of bank employees’ involvement in banking sector fraud, the Ghana Association of Banks (GAB) as part of its strategy, has recommended that bankers undergo periodic lifestyle audits.
Customers and industry watchers were shocked after the 2023 Bank of Ghana’s banking sector fraud report revealed a surge in the number of bank employees involved in fraud cases. The number of bank employees implicated in fraud jumped from 188 in 2022 to 274 in 2023 representing a 46% increase.
The report reveals that the main modus operandi of these unscrupulous employees includes cash theft, widely known as cash suppression, authorized withdrawals, document manipulation, etc.
The financial impact of fraud has been significant, with total fraud-related losses for banks reaching GH¢63 million in 2023, up by 21% from GH¢52 million in the previous year. The situation, industry players say is a cause of concern and a threat to the confidence in the country’s banking sector.
To directly tackle this aspect of the banking sector fraud head-on, the Ghana Association of Banks in its 7-point recommendation is calling on banks to scrutinize staff spending habits. This, GAB believes will enable the banks to identify any discrepancies between employees’ financial activities and their compensation.
GAB says such lifestyle audits of employees should also encompass social media activities to pick signs of unusual acquisitions and wealth to enhance the early detection of potential fraud.
The audits, according to the Association of Banks, will complement other internal controls, such as enhanced staff vetting, regular ethical training, and the promotion of a whistleblower culture.
As part of this holistic approach to fraud prevention, staff welfare was also identified by GAB as a significant factor that requires attention. With the cost of living rising, financial stress among employees can compromise ethical standards.
GAB recommends that banks regularly assess employee well-being and provide adequate support to prevent financial pressures from leading to fraudulent actions.
