A Senior Advocate of Nigeria (SAN), Dr. Monday Ubani, has raised alarm over the growing abuse of Point of Sale (POS) machines by criminal elements in Nigeria. According to him, what was originally designed to promote financial inclusion has now become a major threat to national security.
In a strongly-worded statement titled “The Urgent Need to Regulate POS Transactions in Nigeria’s Financial Ecosystem”, Dr. Ubani warned that kidnappers, fraudsters, and money launderers have found a loophole in the POS system to move large sums of money undetected.
“What we are seeing now is frightening,” Ubani said. “POS terminals have become the preferred method for criminals to move large sums of money anonymously. Kidnappers now demand ransom through POS, and fraudsters launder stolen funds via POS agents who do not verify identities.”
Ubani said his recent conversation with a High Court judge in Eastern Nigeria exposed how deep the problem has grown. He narrated a specific case where a family paid ₦90 million in ransom through POS machines to secure the release of a kidnapped relative. When the case reached the court, investigators could not trace the money trail because the POS agents involved had no records of the transactions or the recipients.
He described this as “a justice system crippled by invisible money,” adding that most POS agents in Nigeria are operating like “financial mercenaries,” without any need to verify customer identities, document transactions, or follow Know Your Customer (KYC) rules.
Ubani called out the Central Bank of Nigeria (CBN) and financial regulators for ignoring what he described as a “ticking time bomb” in the financial system. He urged the apex bank to enforce strict policies that would require all POS devices and bank accounts to be linked with the Bank Verification Number (BVN) and National Identification Number (NIN) of the operators.
“If a POS agent cannot tell you who received a ₦5 million transfer, then we have a national crisis,” Ubani stressed.
To prevent further abuse, he recommended that no POS transaction, especially those involving large sums, should be allowed without verifiable ID such as a NIN slip, voter’s card, driver’s licence, or international passport. He said agents must also keep copies of the customer’s identification and photograph, and that these records must be made available to law enforcement upon request.
“Any POS operator who fails to verify or record customer identities should be held liable. If their negligence supports any criminal act, they must be prosecuted,” he declared.
Ubani also called for the urgent establishment of a central database for all POS transactions. He suggested that security agencies such as the Economic and Financial Crimes Commission (EFCC), Department of State Services (DSS), Nigeria Police Force (NPF), and the Nigerian Financial Intelligence Unit (NFIU) should have real-time access to this data. This would help track suspicious financial movements, especially in remote or high-risk areas.
Beyond law enforcement, Ubani urged fintech companies and CBN to deploy artificial intelligence (AI) and geo-fencing technologies to monitor POS transactions, especially in areas where transaction volumes do not match the size of the population or local economy.
He also stressed the importance of public awareness. According to him, many Nigerians are not aware of the dangers of using POS machines carelessly. “The average Nigerian needs to know that casual POS use can make them an accomplice in a crime. Communities must be alert. Ignorance is no longer an excuse,” he warned.
Dr. Ubani said unless immediate regulatory steps are taken, Nigeria risks allowing a shadow financial system to flourish. “This is no longer just about fraud. It is about national security,” he concluded.
