Adesokan Ayodeji, a tech expert and supporter of Artificial Intelligence, has urged the Federal Government to consider using AI and data analysis as important tools to ensure openness in finances and early detection of fraud.
He mentioned that openness and early fraud detection are crucial for the stability and credibility of any country, especially in Nigeria where the financial sector is key in propelling growth and progress.
In a statement given to PUNCH Online on Wednesday, Ayodeji, a lead consultant at Ambiance Media Limited, said, “The traditional methods of monitoring and detecting fraudulent activities often fall short in the face of increasingly sophisticated schemes.
“The rise of artificial intelligence (AI) and data analysis offers a promising solution to improve openness and combat fraud within Nigeria’s financial sector.”
Ayodeji mentioned that Nigeria struggles with problems related to “financial openness and fraud, worsened by corruption, inadequate regulatory frameworks, and technological limitations”, and noted that despite efforts by regulatory bodies and law enforcement agencies, “fraudulent activities persist, undermining investor confidence and hindering economic progress”.
He mentioned that traditional methods of fraud detection, relying on manual processes and outdated systems, “are often reactive and ineffective, leaving openings for perpetrators to exploit.”
The statement read, “AI has great potential to transform fraud detection and financial openness in Nigeria. Machine learning algorithms can study large amounts of financial data to spot patterns indicating fraudulent activities, enabling proactive detection and prevention.
“Natural language processing (NLP) techniques can analyze unorganized data sources such as emails and documents to reveal hidden insights. Furthermore, predictive analysis can forecast potential fraud risks, allowing organizations to reduce threats before they occur.
“Data analysis complements AI in enhancing fraud detection capabilities. Advanced analysis tools can uncover irregularities and deviations from expected behavior, flagging suspicious transactions for further investigation.
“By integrating data from different sources, such as transactional records, customer profiles, and external datasets, organizations can gain a comprehensive view of financial activities, enabling more informed decision-making and risk management.
“Despite the possible benefits, the use of AI and data analysis in Nigeria encounters several challenges. Limited access to high-quality data, inadequate infrastructure, and a shortage of skilled professionals pose barriers to implementation.
“Moreover, concerns about data privacy, security, and regulatory compliance must be addressed to build trust and confidence in AI-driven solutions. Collaborative efforts between government agencies, financial institutions, and technology providers are crucial to overcome these challenges and realize the full potential of AI and data analysis in fighting financial fraud.
“In the future, Nigeria must focus on investing in AI research and development, data infrastructure, and workforce training to develop the necessary capabilities for sustainable progress.
“Partnerships between the public and private sectors can help with sharing knowledge and mobilizing resources, while changes in regulations should encourage innovation and prevent misuse and abuse. Embracing transparency, accountability, and continuous improvement will be crucial for creating a strong and trustworthy financial system in Nigeria.
“Using AI and data analytics has great potential for improving financial transparency and detecting fraud in Nigeria. By using these innovative technologies, Nigeria can strengthen its financial systems, protect against fraudulent activities, and build confidence among investors for economic growth.
“However, it will take combined efforts and cooperative partnerships to overcome challenges in implementation and realize the full potential of AI and data analytics in enhancing financial integrity and accountability in Nigeria.”
