The Governor of the Bank of Ghana, Dr. Abdul Nashiru Issahaku has asked banks to step up efforts in stemming the incidence of electronic fraud (e-fraud) in order to save the country from being blacklisted again by the global Financial Action Task Force.

This, he said, will require a more concerted approach in fighting a threat that could cause reputational damage to Ghana’s financial services sector in the face of increasing cases of e-fraud in the country. A recent report by the Consumer Protection Unit of the Bank of Ghana this year indicates that electronic fraud constitutes more than 80 percent of all complaints and fraud cases the central bank receives.

Dr. Issahaku said even though electronic banking is the future of the banking industry, the consequences of e-fraud on the industry and the economy in general makes it imperative for banks to step up efforts to bring the menace to an end.“Electronic fraud, if not checked, could pose a huge reputational and operational risk to the banking industry as a whole…Though the world is moving to electronic banking, the associated risk could be enormous and I wish to urge banks to step up their risk assessment to curtail the surge.“

This trend could cause reputational damage not only to banks but may have systematic implications that could even lead to blacklisting of the country by the Financial Action Task Force (FATF)- the international anti money laundering and combatting the financing of terrorism body,” Dr. Issahaku said at the 16th annual working luncheon of the Ghana Association of Bankers held in Accra.Blacklisting of Ghana by the global Financial Action Task Force will be the second time the country has faced sanctions following the maiden one four years ago, which affected transactional activities between consumer and institutional firms in Ghana and their counterparts outside the country.

Dr. Issahaku therefore reminded the bankers to take a cue from the previous blacklisting of the country in 2012 on allegations of money laundering in the financial sector, which he says “affected most of the correspondent relationship between local and foreign banks.” He further urged banks to intensify educating their customers on online banking and conduct proper security assessments of banking apps and tools before integrating them into their core operating systems.According to the e-Crime Bureau, a cyber security company in Ghana, the banking industry loses about US$250,000 weekly due to cyber-crime. Dr. Issahaku said for banks to be able to fight the canker, cooperation among themselves remains key rather than competition.“

Let me also emphasize that, to reduce the risk further would require a much wider and more coordinated effort among banks, payment networks, regulators and governments to strengthen security, especially among the weakest links in our financial infrastructure. When it comes to electronic fraud, what we need as an industry is cooperation and not competition,” he maintained.Ghana is not alone in facing the menace of electronic fraud. In February 2016, instructions to steal US$951million from the central bank of Bangladesh were issued via the SWIFT network – a platform that provides a network that enables financial institutions worldwide to send and receive information about financial transactions in a secure, standardised and reliable environment.

Five transactions issued by hackers, worth US$101million and withdrawn from the Bangladesh Bank account at the Federal Reserve Bank of New York, succeeded.