Peer-to-peer (P2P) currency trading has become a common financial activity in Nigeria, but it comes with significant risks. Many honest traders have fallen victim to scams, losing their hard-earned money hours or days after confirming a credit alert. The Nigerian Tribune has identified five main tricks scammers use to initiate transfer reversals and bypass standard verification. These methods have caught many traders off guard, highlighting the need for caution and awareness.
One common trick used by scammers is the bogus “unauthorised transaction” chargeback. In this scheme, the buyer sends real money directly to the seller's account, and once the trade is marked complete, the buyer contacts their bank's fraud desk to claim that their phone was stolen or they never authorized the debit. According to security guidance published by Binance Security and consumer fraud researchers, commercial banks are obligated to investigate unauthorized debit claims. If the bank rules the transaction fraudulent, they initiate a direct clawback, pulling the money out of the seller's account.
Another trick used by scammers is using compromised third-party accounts. Fraudsters rarely use bank accounts linked to their own Bank Verification Number (BVN) or National Identity Number (NIN). Instead, they hack someone else's mobile banking app or use a stolen SIM card to initiate the payment into the seller's account. Under Central Bank of Nigeria (CBN) regulations on electronic fraud, beneficiary accounts tied to reported stolen funds are immediately flagged, and the bank places a Post-No-Debit (PND) restriction on the account, reversing the funds back to the original victim.
Scammers also exploit interbank settlement delays and pending queues to their advantage. A fraudster initiates a transfer from a financial institution or digital wallet known for delayed settlements or pending states, sending a confirmation screen showing the transfer is “in progress” or “processing”. The buyer exerts intense emotional pressure, urging the seller to release the assets immediately. Once the seller gives in and releases the trade, the buyer quickly cancels the pending instruction on their banking app before the transfer finalizes, ensuring the funds bounce back to them.
The deliberate overpayment and urgent refund request is another psychological confidence trick used by scammers. The scammer agrees to buy an asset for ₦50,000 but intentionally sends ₦70,000 to the seller's bank account. Immediately after payment, they call or message the seller, explaining that they made an honest mistake and overpaid by ₦20,000. They plead with the seller to quickly refund the excess ₦20,000 back to an entirely different account number before releasing the asset. If the seller sends the refund, they walk straight into the scammer's trap.
Fabricated bank alerts remain a very dangerous technique across peer-to-peer communities. Scammers use bulk SMS masking tools or specialized editing software to push an SMS alert to the seller's phone that closely mimics the bank's sender ID and tone. They demand that the seller release the crypto immediately, claiming the transaction has timed out on their end. If the seller refuses, they file a formal dispute on the platform using the fake receipt as evidence. Under panic and platform timer pressure, many sellers release the asset without verifying their actual ledger balance.
To prevent these scams, it is essential to develop steady habits and refuse to be rushed. Sellers should never release their crypto or asset based on an SMS notification or a shared screenshot; instead, they should log directly into their mobile banking app to confirm that the money is sitting in their available balance. Sellers should also strictly enforce the name-match rule and maintain a separate, dedicated settlement bank account for receiving P2P transfers. By taking these precautions, sellers can protect themselves from these scams and keep their money safe.
Key points
- Scammers use various tricks to reverse bank transfers in P2P transactions, including bogus unauthorized transaction chargebacks and compromised third-party accounts.
- To prevent these scams, sellers should verify transactions through their mobile banking app and enforce the name-match rule.
- Maintaining a separate, dedicated settlement bank account for receiving P2P transfers can also help protect sellers from these scams.
