Tanzania launches investigations into Sh148 billion bank card fraud

The scale of the transactions has exposed weaknesses in card security systems and internal controls within banks.

Presenting the bureau’s 2024/25 performance report at State House, PCCB director general, Crispin Chalamila, said investigations has linked the losses to compromised bank cards.

He noted that the stolen funds were channelled into various expenditures, including tourism, health insurance and logistics.

Reacting to the report, the Bank of Tanzania (BoT) Governor, Mr Emmanuel Tutuba, said authorities have since launched a massive investigations into the matter, adding that controls have since been tightened across the financial sector to curb similar incidents.

The suspects, he said, believed to be foreign nationals used advanced technology to clone bank cards and siphon funds from unsuspecting account holders.

According to Mr Tutuba, PCCB has already arrested several suspects, with cases now proceeding to court. The accused have also been ordered to refund the stolen money.

“These individuals used sophisticated technology to clone bank cards and steal funds from legitimate account holders. Investigations are ongoing, controls have been strengthened, and several suspects have already been arrested, with court proceedings underway and recovery of the stolen funds in progress,” said Mr Tutuba.

He did not reveal the actual amount to be recovered soon and the number of suspects arrested and charged in courts so far.

While investigations continue, financial experts have raised concern over the implications of the fraud on public confidence in the banking sector, warning that such incidents could undermine trust if not addressed decisively.

A senior lecturer in finance and banking at the University of Dar es Salaam (UDSM), Dr Tobias Swai, said the case highlights the urgent need to strengthen financial literacy among bank clients, particularly in monitoring account activity and identifying suspicious transactions.

“Many bank clients still lack the knowledge to detect irregular transactions or act promptly when discrepancies occur,” he told The Citizen. “They have the right to question unexplained deductions, but they must also review their statements regularly and safeguard their financial information.”

Dr Swai also urged the BoT to reinforce its supervisory role by ensuring banks adhere to strict operational and security standards. He said regulators should act on the PCCB findings by holding accountable institutions, including their boards and senior management, where lapses are identified.

He further encouraged customers to utilise complaint-handling mechanisms and consumer protection frameworks, while advising them to avoid institutions that fail to meet required standards.

Consumer associations, he added, should play a more active role in educating the public on safe banking practices.

University of Dodoma (Udom) economics lecturer Dr Lutengano Mwinuka said incidents of fraud and theft damage the image of financial institutions, particularly in a sector that relies heavily on trust. He noted that many customers are unable to consistently monitor their accounts, making them more vulnerable to losses.

“This is particularly critical for customers with substantial funds, who stand to incur significant losses if systems are not secure,” he said.

Dr Mwinuka called for wider adoption of robust Information and Communication Technology (ICT) systems to enhance security and detect fraudulent activities more effectively. He also urged the central bank to strengthen oversight and ensure compliance with regulatory requirements.

He said some institutions still rely heavily on internal processes that may not be adequate to address emerging risks, underscoring the need to modernise systems and improve internal controls.

“Trust in the banking system must begin from within institutions by ensuring that procedures and systems adequately protect customer rights,” he said, adding that continuous system upgrades are essential to keep pace with evolving technological threats.