FORENSIC ACCOUNTING, FRAUD ANALYSIS, INVESTIGATION AND PREVENTION: A CASE OF DEPOSIT MONEY BANKS IN NIGERIA

The study examines the role of forensic accounting in detecting, analysing, investigating and preventing fraud in Nigerian Deposit Money Banks (DMBs). The banking sector is the most vulnerable industry in Nigeria to fraud with the Nigeria Deposit Insurance Corporation (NDIC) reporting cumulative losses in the sector from 2019 to 2023 has surpassed ₦150 billion. The study was of a convergent mixed methodology. The population consisted of forensic accountants, internal auditors, compliance officers, risk officers and external forensic investigators in the 24 licensed DMBs in Nigeria. Stratified random sampling was used to select a sample of 220 respondents (68 forensic accountants, 84 internal auditors, 48 compliance/risk officers, and 20 external investigators) and a five year longitudinal analysis of NDIC fraud data, 2019-2023, supplemented with 12 semi structured expert interviews. The data were analysed using descriptive statistics, chi-square tests and logistic regression. Those results show that insider-facilitated fraud is responsible for 61.7% of all bank fraud cases, that forensic accounting technologies can shorten the time to detect fraud by an average of 42.5% and that banks with forensic units report 35.4% less in fraud losses than banks without forensic units. The study formulates and recommends a Forensic Fraud Prevention Model (FFPM), which is a structured model of the integration of detection, investigation and prevention layers along with institutional enablers (CBN, NDIC, EFCC, and professional bodies). The study calls for an integrated monitoring of transactions in real-time with the CBN's fraud reporting system, also mandatory forensic accounting units in all the DMBs and strengthen whistle blowers’ protection.