Basic anti Fraud Measure

1. Basic Anti Fraud Measures
KKMFB KSS
By: --- Awodiran Stephen (Compliance Department)

2. Outline
Introduction to Fraud
What are the Risk to Fraud
Common myths about Fraud
KKMFB Anti fraud Policy and its preventive measure to fraud
Basic Antifraud Measures
Case Study and Conclusion

3. Introdcution
Fraud is an intentional act designed to deceive others, resulting in the victim
suffering a loss and /or the perpetrator achieving a gain
We can also say that fraud is a wrongful or criminal deception intended to
result in financial or personal gain.
Fraud can take many forms such as theft, embezzlement, bribery,
corruption, identity theft, cybercrime e.t.c
Fraud can be committed by anyone, such as employees, customers,
vendors, beneficial owners e.t.c

4. 4
What are the Risk to fraud
Fraud can have serious consequences for an
organization, such as:
1. Financial losses
2. Reputational damage
3. Legal liability
4. Regulatory sanctions
5. Loss of trust
6. Fraud can also affect the morale and productivity
of other employees who may feel betrayed,
demotivated or fearful e.t.c

5. 5
Common myths about Fraud
Some people may believe that fraud is rare, harmless or justified
in some situations. However, these are some common myths that
need tobe debunked.
Myth: Fraud only happens in large or corrupt organizations.
Fact: Fraud can happen in any organization, regardless of size or
sector.
Myth: Fraud is a victimless crime
Fact: Fraud always harms someone or something, such as the
organization, its stakeholders, its customers, its competitors e.t.c
Myth: Fraud is acceptable if it benefits the organization or its
employees.
Fact: Fraud is never acceptable or ethical. It violates the law and
the organization’s values and policies

6. Some of the common Cases of Fraud in
MFB’s
Some of the common cases of fraud in Microfinance banks are:
1. Loan Fraud: This involves falsifying loan applications, diverting loan funds, inflating
loan amounts, or colluding with borrowers to default on repayments
2. Deposit Fraud: This involves misappropriating depositor’s funds, issuing fake
deposit slip or tampering with deposit records.
3. Accounting Fraud: This involves manipulating financial statements, concealing
losses, overstating assets, or understating liabilities.
4. Operational Fraud:This involves abusing authority, violating policies, misusing
resources, or engaging in corruption

7. 7
KKMFB Anti Fraud Policy and its preventive Measure to Fraud
1. KKMFB has an Anti fraud framework and Internal
control systems to combat fraud
2. KKMFB has ethical standards and corporate
governance
3. KKMFB render necessary returns to regulators on its
activities hence details of fraudulent activities will be
submitted if it happens
4. KKMFB has a whistleblowing mechanism, employees
are advised to speak up at the instance of suspicious
activity/transaction
5. Training and Awareness

8. 8
What you need to do as an Employee
• Comply with the antifraud, internal control policies and
procedure
• Be aware of the common signs and indicators of fraud and if
unclear speak with your supervisor
• Report any suspected or actul fraud to your supervsior, or to
the appropraite department (Compliance, Risk and Audit)
• Cooperate with Fraud investigators
• Maintain confidentiality and discretion when dealing with
fraud matters

9. 9
Case Study for Discussion
Adedeji the first child from a family of seven got married to Evelyn the second child from a family
of four. There marriage is blessed with two kids.
Adedeji works with A-Z MFB as a loan officer and earns a basic salary of #150,000 monthly.
Adedeji’s mother a widow and a retired Teacher started living with his son after her retirement in
2021.
Adedji had so much responsibility on him because he has been assisting her siblings to further
their education, he also obtained several loans whose repayment is more than his monthly
income.
Evelyn is heavily pregnant and has been advised to come for ceasarian section which will cost
#250,000. Adedeji being loved by several client laise with Mr Jude (one of his client) to obtain a
loan of #500,000 which he collected #250,000 to settle Evelyn’s hospital bill.
Looking at this scenario
1. Which type of fraud did Adedeji commit.
2. As a close friend of Adedeji which he confides in and you both work in the same bank what will
you do? escalate or keep the secret (The management is unaware)

10. Conclusion
Fraud is a pervasive and costly problem that affects individuals, organizations, and society.
Fraud can take many forms and involve various actors, motives, and methods. Therefore, it is
important to understand the nature, causes, and consequences of fraud, as well as the ways to
prevent, detect, and respond to it.
We should endeavour to foster a culture of integrity, transparency, and accountability that
discourages fraudulent behavior and promotes ethical conduct.
Together, we can make a difference in reducing the incidence and impact of fraud in our
environment.
Thank you for your attention and participation.

11. THANK YOU