CHAPTER ONE

1.0     INTRODUCTION

1.1     BACKGROUND OF THE STUDY

            The level of fraud in the day Nigeria has assumed an epidemic dimension. It has eaten deep into every aspect to the extent that a three-year-odd-child talks about 419.

            Fraud is defined as a deliberate act of deceiving somebody in all illegal way in order to make to obtain goods belonging to another party. For an action to constitute Fraud there must be a dishonest intention and the action, must be intended to benefit the preparation to the determine of another person.

            Going by this definition fraud in Nigeria economy cannot be restricted to the bank alone. Fraud in the Banks is not know, they are as old as the Industry itself. However, like in the greater society they have become one of the most intractable problems of modem day banking.

            Other sharp practices that is being perpetrated in the banking industry includes, embezzlement and theft, miss use or harm the asset of the bank, manipulation of figures, forgeries but all  these can be compassed into Fraud that is the word “Fraud” can capsulate all these acts.

            Fraud can be committed by the employers, customer and management of the bank concerned or others operating independently or in conspiracy with others inside or outside the financial institution.

            The historical trends and analysis of the banking industry in Nigeria is discussed to assist in the understanding of the philosophies that will guide prospective reader in the extent to the bank Frauds had been in place.

            Modern banking in Nigeria dates back to the early colonial period. This is as the period when the activities of transaction of the colonial government the deadline of the bater system of frauds and the increasing acceptance of British silver coins, all desired for constitutions in the form of commercial banks for safety and transmission of frauds, the importations and distribution British coin, and provision of credit facilities to the government an the trading companies (usage 1981).

            It was for this purpose in 1872 that the Africa Banking Corporation of England was invited to open a branch office based in Liverpool and West African ports.

            But due to some difficulties, the bank was taken over in 1894 by Elder Depicter and Company with a name as Bank of British  West African (now First Bank of Nigeria Plc ) Registered in London, the bank started with a authorized capital of $100,000. Due to the success of the bank of British West Africa other organizations soon began to show interest in banking opportunities in the Country. This led to the establishment of the Anglo-African Bank, later known as banks of Nigeria, but which became liquidated other were the colonial bank which changed its name of Barcley bank and company (now the Union Bank of Nigeria Plc 1919) also British and French bank 1948 (now the United bank for Africa Plc) and such other foreign owned banks.