Union Bank goes to court over ₦9.3bn fraud

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Union Bank heads to court to recover ₦9.3 billion obtained by fraudsters

I sometimes joke that the “F” in fintech stands for fraud, but commercial banks also get hit by bad actors. From 2024, we saw more media reports on fraud losses at banks, and it’s safe to say everyone in the financial services industry has to stay ahead of fraudsters.

The latest incident involves Union Bank.

The bank has approached a federal high court to recover ₦9.3 billion that was “fraudulently and erroneously moved from its customers’ accounts to various accounts held across 54 banks,” according to a court filing.

Union Bank said it detected the unauthorized transactions on March 25, 2025, and then contacted the Department of State Services (DSS), requesting a formal investigation into the breach. It did not share the report of that investigation.

However, investigations by the bank’s fraud desk showed that the money was broken into smaller sums and rerouted into accounts across more than 20 commercial banks, a well-worn laundering tactic designed to obscure the money trail and slow recovery efforts.

Union Bank isn’t alone. In 2024, UBA lost ₦1.14 billion to fraud even as it reported record profits. While the bank flagged the losses as immaterial, it still marks a significant increase compared to previous years.

Access Holdings also disclosed that its fraud losses jumped by 29% year-on-year, with ₦3.4 billion lost to fraudulent transactions in 2024.

The fraud losses are a drop in the bucket for many of these banks, but there have been some eye-popping incidents, like a ₦40 billion fraud at First Bank reported in August 2024.

These incidents suggest systemic vulnerabilities in banks’ internal processes and growing boldness among fraudsters. Union Bank’s incident also highlights the complexity of reversing fraud that cuts across dozens of banks. As more fraud cases spill into courtrooms, expect more scrutiny on how Nigerian banks manage cybersecurity, internal access controls, and interbank settlement protocols.

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