A recent report by the Nigerian Deposit Insurance Corporation (NDIC) revealed that Nigeria's banking sector recorded N28.4bn cases of fraud and forgeries in 2011. Again, last week, the KPMG, a global leader in auditing, in its Second Africa Fraud Barometer findings, rated Nigeria as the most fraudulent country in Africa. KPMG said whereas the number of fraud cases in Africa fell marginally to 503 in the second half of this year compared with 520, the value of cases also fell from US$3.3bn to US$2bn, in the same period last year. Nigeria, Kenya, Zimbabwe and South Africa accounted for 74 per cent of all fraud cases reported on the continent. And while fewer cases were reported in South Africa, the overall value of these cases is far greater in Nigeria.
The Barometer differentiated between the number of reported fraud cases, type of perpetrators, victims of fraud, type of fraud, countries and targeted industries. Not surprisingly, our extractive industries, especially, oil and gas sector recommended us for the prime position of the continent's most fraudulent nation. We wonder what the response of the government that claimed it has done more than any of its predecessors to fight the scourge of corruption is to this revelation.
It is a truism that there is an increasing interest in Africa as an investment destination, but the continent struggles with a rather negative image. KPMG's analysis of fraud profiles in individual African countries will send a wrong signal to foreign investors and scare them off the shores of Nigeria. The attitude of the government to the myriad corruption cases, where people have been indicted but neither diligently prosecuted nor penalised would also make investors run for their business integrity and return on investment as exemplified by the Siemens and Halliburton cases.
The Independence Day gaffe by the President that Nigeria has been rated second as a virulent corruption fighter globally is equally a joke carried too far. The Global Corruption Index carried out by Transparency International has always returned a damning verdict on the country. Surprisingly internet fraud, bribery, kickback, nepotism and bare-faced stealing of public funds keep mutating at an alarming rate and the perpetrators walk away free. While budget performance is rated low on capital projects, the profligacy of office holders has soared. It is a common feature that at the end of every month once monies are released from the Federation Account to all tiers of government, the foreign exchange rate also goes up and correspondingly illegal currency trafficking equally peaks.
Last month, the sum of $2,073,160 dollars and Saudi Arabian Riyal SAR20, 300 was seized from TalalHammoud and Hassan Rmaiti who failed to declare them at the point of departure area of 'E' Wing of the airport. The undeclared funds were carried in three bags. A couple of days later another Nigerian, OnwuekweChidi was arrested with $320,000 cash at the same airport as he was about to board a Qatar plane to Doha. We wonder what happened to the enforcement and compliance with the anti-money laundering laws and the efforts to beat the October 15, 2012 deadline by the Financial Action Task Force (FATF) for Nigeria to amend two bills on Money Laundering (Prohibition) and the Terrorism (Prevention) Act 2011. We insist that until the Federal Government changes its lacklustre attitude at strengthening its laws to bring offenders to book, these two global crimes will continue to haunt us.