AN EXAMINATION OF INTERNAL CONTROL SYSTEM AND BANK FRAUD PREVENTION IN NIGERIA BANKING INDUSTRY

Background of the study: The significance of internal control in Nigerian banks cannot be overstated. It is now considered a crucial aspect of organisational strength. This is primarily because a well-functioning control system is essential for maintaining an efficient accounting system. The importance of internal control systems in organisations, particularly banks, cannot be underestimated. This is because the banking sector plays a critical role in the economic development of a nation, but is currently facing challenges such as macroeconomic instability, sluggish growth in real economic activities, corruption, and the risk of fraud. Fraud has emerged as a significant challenge for many Nigerians, leading to the establishment of internal control systems as a primary solution. Furthermore, it is regrettable that Nigeria's international reputation has been consistently affected by this issue. The prevalence of fraud within the Nigerian banking system is a significant concern, particularly for banks with inadequate internal control systems. The impact of fraud on banks has been extensive and requires immediate attention. The research study focuses on the internal control system and bank fraud prevention in the Nigerian banking industry, specifically using Union Bank Plc as a case study. This topic arises from the need to address the economic degradation and find solutions to mitigate fraud in the banking sector. This study seeks to validate the notion that an internal control system that is both effective and efficient is the most effective means of preventing and detecting fraud, particularly within the banking industry.