ATM FRAUDS: CBN to Sanction Banks

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atmth2The Central Bank of Nigeria, CBN has threatened to sanction banks over the rising incidence of frauds through Automated Teller Machines (ATMs).

The CBN said that though there is increased acceptance and usage of electronic payment channels, there is however increasing incidence of ATM fraud. It therefore directed banks to install on their ATMs technologies that can forestall this trend.

This was contained in a circular to banks titled, Need to install anti-skimming device at all ATM terminals. The circular was signed by Mr. Dipo Fatokun, Director, Banking and Payment System department, CBN. It stated, The Central Bank has observed the growth in the adoption of e-payment of ATMs by Nigerians as one of the channels of e-payment The Bank is therefore committed to the deployment and management of ATMs in line with global best practices.

“However, we have observed with dismay, an upward increase in the number of ATMs related fraud in the banking system. The development does not portend good for the industry and requires urgent steps to curb the abuse.

“Consequently, in addition to the existing guidelines on card related frauds and in order to guard against card skimming at ATM channels across the country, all deposit money banks (DMBs) are hereby mandated to comply with the provisions of section 3.2 ‘ATM Operations’ and 3.4 ‘ATM security’ of the Standards and Guidelines on ATM operations in Nigeria and also install risk mitigating devices on their ATM terminals on or before June 1st, 2014. The CBN would invoke appropriate sanctions for non compliance with this circular.”

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