chapter One


Research background
Since the establishment of his three successful indigenous banks, the first in Nigeria, on 11 February 1933 he established the National Bank of Nigeria, in 1945 he established Agbommagbe Bank (now Wema Bank Nig Plc), and in 1947 he established African Continental Bank Plc. etc. was established. Established in Nigeria, the first Banking Ordinance was enacted in 1952 to regulate and control the activities of commercial banks in the country, and to this day, Prand has again become an integral part of the banking industry.

During the free banking era (1892-1952), there were no banking laws or regulations regulating the stability, delivery and operation of commercial banks. Yes, we are currently monitoring it. Many banks are registered. Some stores didn’t even open their doors for a day, others just collected customer deposits and applied varnish. This had resulted to the deprivation of our economy an as a whole the much needs fund for development and depriving individual the hard earned funds, this also brought about loss of faith trust on the commercial banks by Nigeria and the subsequent under developed banking habit in the country

However, with the introduction of the first banking ordinance in 1952 and the central bank of Nigeria (CBN) ordinance in 1958 to regulate and control the activities of commercial banking in the country fraud in commercial banks have rather increased in size, and method used by fraudster acquires greater sophistication day by day. Presently with the introduction or modern banking procedures ie improved communication system, automatic electronic gadgets and computers networks into our banking system coupled with various precautionary measures taken by banks. To prevent fraud in the banks fraud have rather taken unclear dimension and the six and form involved increase in a geometric progression. Other Amptiam in his articles obstacle o growth of baking industry saw that it was discovered during investigation that bank now take extra precaution before clearing a cheque because of rampant incident of fraud and forgeries the form of fraud has placed banks loss on the average of # 1m per each working day of the year in Nigeria Asimi kola in his own article “The cash economy phenomenon” also observed that fraud has become sophisticated as to make forget cheque book good the owner to confirm it as his own signature recently in the bid curb the grand fraud, CBN issued a directive to bank to increase it capital base to # 25 billion. Previously section a of the decree 1990 state that, the minimum paid up capital for bank is #50 million for commercial bank. The directive came after some banks were found to be cheating their customers, mostly foreign investors. necessary.

To reduce the scale and prevalence of fraud at banks, bankers now take reasonable precautions before clearing checks drawn from customer accounts. These precautions focus on another problem facing commercial banks. The problem of wasting time at the counter hall. Ashimi Kola also said in his article that customers have been waiting at least two hours in bank halls of Nigerian banks to cash out their money. This is one of his most justified criticisms of the quality of banking services. The verification process takes time, customers are frustrated and Rast can be sleeping in a frenzied crowd by the time the check clears for payment at the cash register. This requires an overhaul of control and monitoring systems.


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