INTERNAL CONTROL SYSTEM AS A MEANS OF PREVENTING FRAUD IN NIGERIA FINANCIAL INSTITUTIONS (A STUDY OF SOME SELECTED BANKS IN LAFIA)

This study assesses internal control system as a means of preventing fraud in Nigerian Financial Institution with reference to Union Bank Plc, Lafia, First Bank Nigeria Plc, Lafia branch and Zenith Bank Plc, Lafia branch. The research objective is to find out the impact of internal control system on the overall management of fraud in the above selected banks. The researcher made use of survey research design and a population of Forty-Nine (49) staff of which forty-three (43) was derived as sample size through Taro Yamane Formula. Questionnaire were distributed and all the questionnaire were filled and returned. Simple Table and Percentages were used to analyze the data collected through the questionnaire. It was discovered that banks experienced issue of fraud and measures has been set to curb bank fraud which implies that the bank need to educate customers and employees about social engineering attacks. The banks should have a fraud monitoring system (internal control system) incorporated into their online banking system and manually review audit trails, reports daily and alert customers when there is suspicious activity. The researcher recommended that management of the above selected banks should ensure to check ameliorate the identified problems encountered in the utilization of effective internal control system with the necessary strategies this will help reduce fraud drastically, such strategies are data mining, data matching, sounds like function, Regression analysis, Clustering analysis, and Gap to effectively test, detect, validate, correct errors, and monitor control systems against fraudulent activities.