NCC making effort within regulatory framework to curb financial crimes

Robust information and communication technology (ICT) systems are critical for preventing and investigating financial crimes or mitigating the risks associated with virtual assets in financial markets.

These systems facilitate compliance with established standards or regulations, they also provide a platform that allows the monitoring, tracing, and analyzing of digital transactions in real-time. ICT systems support secure data storage and encryption technologies, which are critical for safeguarding sensitive financial data.

The emergence of digital banking has led to the proliferation of financial crimes especially in terms of e-fraud.

According to the Executive Vice Chairman/Chief Executive Officer of the Nigerian Communications Commission (NCC), Dr. Aminu Maida, financial crimes refer to criminal activities that involve transactions, abuse, misuse, deception, or manipulation of financial systems for personal gain.

He added that they include a wide range of offenses such as Insider abuse, Money Laundering, Terrorism Financing, Proliferation Financing, embezzlement, Fraud (e-fraud, Banking, securities, corporate, Intellectual Property), etc.

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“These crimes do not only have a huge economic and social impact but can also be linked to violent crimes that lead to loss of lives. These crimes threaten the integrity, trustworthiness, stability, security, safety, and future of an entity (Country, enterprise, individual),” he stated.

Maida said robust information and communication technology (ICT) systems are critical for preventing/investigating financial crimes or mitigating the risks associated with virtual assets in financial markets.

“These systems facilitate compliance with established standards or regulations, they also provide a platform that allows the monitoring, tracing, and analyzing of digital transactions in real time. ICT systems support secure data storage and encryption technologies, which are critical for safeguarding sensitive financial data.

“Technological advancements have significantly aided crime prevention and law enforcement agency performance. Large datasets have been analyzed using advanced data analytics, artificial intelligence, and machine learning algorithms to look for trends that indicate criminal activity. Based on historical data and real-time intelligence, predictive police programs have arisen to foresee and prevent crimes. Digital forensics techniques have also proven useful in criminal investigations.

Maida noted that Nigeria’s telecoms sector has grown significantly, resulting in massive amounts of data being generated daily.

According to him, the advent of advanced data analytics and artificial intelligence (AI) provides a gateway to identify suspicious digital patterns indicative of crime.

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Through partnerships with financial institutions data can be filtered to identify these suspicious patterns and nip them in the bud. These technologies provide real-time transaction monitoring, allowing for a proactive approach to crime prevention.

It has been said that there must be a solid collaboration among the stakeholders and the experts on the deployment of sophisticated technologies to combat financial crimes.

Banks and tech companies are urged to work together to devise new strategies to be ahead of the criminals as the country loses a huge amount of money to such crimes.

To combat financial crimes, innovative solutions such as blockchain, instant payments, artificial intelligence, machine learning, data analytics, regulatory technology solutions, and automated procedures are being deployed.

The use of technological tools has made it significantly easier to deal with financial crime while building a long-term strategy for combating it.

Computer Security Incident Response Team (CSIRT) is a group of experts, (of which the Nigerian Communications Commission (NCC) is part) that handles security incidents that can affect the operations of organisations. Digital forensics is a branch of forensic science that focuses on identifying, acquiring, processing, analysing, and reporting data stored electronically. Electronic evidence is related to criminal activities and can be admitted in the process of prosecuting offenders in law courts.

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Concerning the significance of data security and privacy in the use of ICT for crime prevention, Maida said strong encryption and access controls ensure the security of critical information.

He stated: “Strict respect for data privacy standards, such as the GDPR (General Data Privacy Regulation) in the European Union and the (NDPA) Nigerian Data Protection Act, aids in the preservation of trust in the use of ICT solutions for crime prevention.”

He listed potential concerns linked with the use of Information and Communication Technology to combat financial crime including cybersecurity threats, noting that as ICT systems get more complex, so do cybercriminal activities. Criminal actors take advantage of the inherent and emerging flaws identified in the ICT systems exploiting these flaws and causing harm.

He said relying too much on automated systems for crime detection might result in false positives, in which innocent people or transactions are identified as suspects. Based on the data on which they are taught, Maida said algorithms may exhibit biases, potentially leading to biased conclusions.

Meanwhile, the NCC boss noted that while ICT has transformed the fight against financial crime, there are still difficulties that must be addressed collaboratively.