FNB fraud warning

The fraud sees criminals falsely presenting themselves as FNB representatives and encouraging non-residents to open South African business accounts. These perpetrators are reportedly registering companies as South African entities.

To this end these criminals will use complicit or unsuspecting victims, stolen identities, or synthetic identities, including passports, proof of address, and related party identification to open business profiles under false pretences.

FNB confirmed that this activity is unauthorised and constitutes a serious breach of its policies and brand integrity. The bank does not operate in Zimbabwe and has not sanctioned any such account openings in that region.

“We are most concerned about the misuse of our brand,” said Roshan Jelal, Head of Fraud at FNB Commercial Chief Risk Office.

“FNB maintains a zero-tolerance policy towards fraud and misrepresentation and has reported this matter to the relevant law enforcement agencies for further action.”

Jelal stressed that FNB is committed to staying ahead of emerging fraud tactics and urged the public to remain vigilant and report any suspicious activity immediately.

Individuals found to be involved in either selling or using fraudulently obtained FNB Business Accounts may face:

• Account termination
• Blacklisting from future banking services
• Legal action, including criminal charges
• Reporting to relevant regulatory authorities

FNB advised that if consumers encounter or suspect such fraudulent activity, they should not engage or share personal information.

They should also report the incident immediately to the FNB Business Fraud Hotline. Supporting evidence can be sent to fraud@fnb.co.za.

FNB said it is developing proactive measures to detect and prevent such fraudulent account openings and will continue to raise awareness through its official channels.

The bank encouraged all customers and stakeholders to stay informed and cautious. Official communications will always come from verified FNB channels.

Financial crime on the rise

FNB isn’t the only institution which has seen a surge in financial crimes. According to the South African Banking Risk Information Centre’s (SABRIC) recently released Annual Crime Statistics report for 2024, financial crime continued to escalate.

The centre revealed that, in 2024, there were significant increases in digital banking fraud, application fraud, and card-related crime.

Digital banking fraud was the most prevalent, making up 65.3% of all reported cases. The volume of incidents nearly doubled from 2023 to 2024, escalating from 31,612 to 64,000 cases. Correspondingly, financial losses rose from R1 billion to over R1.4 billion.

Importantly, these incidents were the result of social engineering techniques that exploited human error, rather than technical compromises of banking platforms.

Card-related fraud continued to be dominated by Card Not Present (CNP) transactions, which made up 85.6% of gross fraud losses on South African-issued credit cards. Lost and stolen cards accounted for 8.2%, while false applications contributed 2.9%.

Counterfeit card fraud also remained a concern, with 64.4% of counterfeit credit card fraud and 63.1% of counterfeit debit card fraud occurring domestically. Toll plazas and service stations were identified as hotspots for such incidents.

However, there were some positive trends. In 2024, South Africa recorded financial crime losses amounting to R2.7 billion, a decline of almost 18% compared to 2023’s R3.3 billion.

SABRIC attributed this improvement to the strengthened prevention and detection measures introduced by the banking industry.

The banking sector also made notable strides in mitigating contact crime. Associated robbery incidents declined by 35%, with client losses reduced by 64% compared to 2023.

Additionally, there was an 18% decrease in ATM attack explosive incidents, which SABRIC attributed to the formation of a task team which combatted these threats through data-driven intelligence and cross-sector collaboration.

SABRIC stressed that it is working with its members to strengthen consumer education and awareness campaigns, expand industry-wide collaboration, and invest in technology to safeguard the banking system.

“Protecting the financial sector requires constant vigilance and cooperation across banks, regulators, law enforcement, and civil society,” said SABRIC CEO, Andre Wentzel. “Together, we can stay ahead of an ever-changing criminal landscape.”

Issued on Daily Investor by Kirsten Minnaar | https://dailyinvestor.com/banking/99907/fnb-fraud-warning/