The Effect of Cybercrime on Financial Institutions: A Case Study of Mumuadu Rural Bank, Osino in the Fanteakwa District - Eastern Region, Ghana

Abstract

Abstract Crimes committed via the internet and other electronic media are a growing threat and an important subject to most organizations. This is because most organizations rely on the internet to provide services to customers. Thus, the use of the inter-networked system of communication in organizations such as the banks poses challenges to both customers and organizations on daily basis. This study analyses cybercrime activities and their effects on Financial Institutions; a case study of Mumuadu Rural Bank Limited, Osino in the Fanteakwa District - Eastern Region. The study was guided by three objectives and used a mixed-method (both qualitative and quantitative) approach in data collection. The total estimated sample size was 30 staff out of a population of thirty – two (32). A questionnaire was used to obtain information from 29 respondents who were randomly selected from the population while an interview was used to solicit further details from the bank’s General Manager who was purposively selected. The findings revealed that cybercrime and information security breaches have reached an alarming proportion with negative consequences on financial Industries. As a result, the bank has different insurance accounts set aside to protect customers against losses that may arise from cybercrime attacks or other related losses that may affect customers. It also emerged that young people in the district mostly indulge in cybercrime activities with the motive of living a luxurious life due to economic hardship attributed to unemployment, and lack of strong policies or legislation. Furthermore, the study also recorded a high rate of respondents who cited a loss of customer confidence due to cybercrime which has led to the loss of lives of customers and a reduction of revenue target of the bank as part of the effects of cybercrime on the bank. Additionally, the research identified some knowledge gaps and consequently recommended that cyber insurance policies be available and also be strengthened to help financial institutions compensate those who may be victims of a cybercrime attack. Furthermore, the paper suggests that organizations be constantly updated by the Security Agencies on the emerging techniques that are deployed by cybercriminals.