₦104 million banking scandal: Fake investment certificates, alleged insider fraud and the AML red flags that should not have been missed

A controversy involving alleged insider fraud, forged investment certificates and suspicious fund transfers has placed Jaiz Bank’s Jos operations under scrutiny, following complaints by customers who claim to have lost approximately ₦104 million.

At the centre of the controversy is Habiba Abdulrahman, a former bank operations official accused of collecting customers’ funds under the guise of opening fixed-deposit and Mudarabah investment accounts that allegedly never existed.

According to findings attributed to the Plateau State Police Criminal Investigation Department, the suspect allegedly used forged bank documents and diverted customers’ funds through accounts belonging to associates, including her husband and younger sister. Investigators reportedly recovered purportedly forged investment certificates and other banking documents during a search.

Police findings also alleged that 12 customers were defrauded, with the money subsequently channelled into other financial accounts. The police reportedly recommended prosecution on allegations including conspiracy, forgery, cheating and breach of trust.

The controversy raises serious Anti-Money Laundering and Counter-Terrorism Financing (AML/CFT) questions. Were suspicious transaction patterns detected? Were beneficiary accounts subjected to enhanced due diligence? Did internal controls adequately segregate transaction initiation, verification and approval functions? Were suspicious transaction reports considered where legally required?

The case also highlights the risks of insider abuse, identity and document fraud, unauthorised transactions and the potential misuse of third-party accounts to obscure money trails.

Jaiz Bank, however, maintains that the disputed funds were not received, booked or authorised under its official investment products, describing the transactions as private dealings involving a former employee. The bank says the matter is before the Plateau State High Court.

Ultimately, the dispute demands transparent investigation, effective recovery measures and accountability. It is also a reminder that robust AML/CFT frameworks must address insider threats, not merely external customers.