By OBIOMA TORI

From Ghost Workers to Fake Agencies: How Nigeria’s Digital Payroll Systems Remain Vulnerable

NIGERIA’S battle against ghost workers was supposed to have been transformed by technology.

The introduction of IPPIS, payroll verification exercises and the Treasury Single Account promised a government system where employees could be properly identified, salaries could be tracked and public funds could be protected from manipulation.

Yet the latest allegations suggest that fraudsters may have moved beyond the traditional ghost worker.

Instead of merely inventing an employee, the emerging threat appears to involve manipulating the administrative architecture through which government institutions and personnel gain legitimacy.

That possibility has prompted the Federal Government to approve a forensic audit of its payroll and administrative systems, amid concerns surrounding ₦9.5 trillion in salary and allowance payments.

A Fake Agency Inside the System

The controversy intensified after Finance Minister Taiwo Oyedele disclosed that unauthorised persons had obtained government administrative and TSA codes for an agency that did not exist: the Presidential Foreign Intervention Promotion Council.

The attempted arrangement was detected before government funds were released.

That detail matters.

The immediate financial damage may have been avoided, but the incident exposed a question that goes far beyond the particular agency involved.

What controls allowed a fictitious institution to acquire the administrative credentials associated with a legitimate government body?

That is the question investigators must answer if the country is to prevent a recurrence.

Twenty Years After IPPIS

IPPIS was introduced in 2007 to reduce payroll fraud and establish a centralised system for managing public-sector personnel.

Its creation followed years of concern over fictitious employees, duplicate salaries and payroll manipulation.

Centralisation was expected to close the gaps created by fragmented personnel administration across ministries, departments and agencies.

But nearly two decades later, ghost workers remain a recurring feature of Nigeria’s public-finance investigations.

The problem is increasingly less about whether a name appears on a payroll.

It is about whether the identity behind that name — and even the institution employing that person — can be independently established.

What Previous Investigations Reveal

Nigeria has repeatedly demonstrated that payroll verification can produce substantial savings.

The 2016 exercise reportedly removed tens of thousands of suspected ghost workers and cut the Federal Government’s monthly wage bill by an estimated ₦13 billion.

However, the savings did not end the problem.

The ICPC later identified ₦49.9 billion allegedly paid to suspected ghost workers during the first six months of 2022.

Its 2024 investigation found 908 suspected ghost workers. The Nigeria Police Force accounted for 570, more than 60 per cent of the identified cases.

Investigators also found 467 bank accounts linked to unverified or unidentified individuals.

The figures point to a persistent weakness in personnel verification and payroll reconciliation.

Nigeria has been successful at finding ghosts.

The more difficult task has been preventing new ones from being created.

Where Human Intervention Meets Digital Systems

The continuing problem exposes a misconception about technology.

Digitising a process does not automatically make that process incorruptible.

A computer system can prevent certain forms of manual manipulation, but authorised users still determine what information enters the system, who receives access and which records are validated.

That creates a critical vulnerability.

If an insider can create or modify an employee record, validate an institution or obtain sensitive administrative credentials without independent confirmation, the digital platform itself may become part of the fraud mechanism.

Technology therefore needs institutional checks around it.

The Police Example

The ICPC findings involving the Nigeria Police Force illustrate the scale of the challenge.

With personnel distributed across numerous commands and formations, maintaining accurate records is difficult.

A worker recognised at one administrative level may be absent from another database, while payroll information can continue moving through the system.

Such discrepancies require regular reconciliation.

They also require clear responsibility.

Where an employee is paid from public funds, there should be a verifiable trail establishing when that person was recruited, where the person works, who supervises the employee and whether the employment remains valid.

From Employees to Institutions

The alleged fake-agency case takes the problem to another level.

Creating a fictitious employee is one thing.

Creating a fictitious institution capable of acquiring government codes is potentially far more consequential.

An institution provides a structure.

It can have officers, accounts, correspondence, administrative codes and budgetary relationships.

If those elements can be manufactured within government systems, the resulting fraud could be much larger than a conventional ghost-worker scheme.

That is why the latest incident should be treated as a systemic warning.

The Accountability Gap

President Bola Tinubu subsequently ordered the arrest of Nwabueze Buchi George and the suspension of three permanent secretaries linked to the investigation.

Those measures may help establish individual responsibility.

However, they do not answer the institutional question.

Investigators must determine how the alleged fraud progressed through the approval chain.

Who created the records?

Who verified them?

Who authorised the codes?

Who had access?

Were warnings ignored?

Did more than one person participate?

And were existing safeguards bypassed or simply inadequate?

Those questions matter because fraud rarely survives on technology alone. It usually requires gaps in oversight, weak controls or human collusion.

What the Forensic Audit Should Examine

The forensic audit should therefore go beyond counting ghost workers.

It should examine the architecture connecting personnel administration to public finance.

Among the key areas are:

• creation and validation of government agencies;
• personnel registration and verification;
• payroll approval procedures;
• changes to employee records;
• administrative-code issuance;
• TSA access and credentials;
• reconciliation between personnel and payment databases;
• audit trails for manual interventions; and
• independent oversight of high-risk transactions.

The government should also establish mechanisms for continuous verification rather than relying on periodic exercises after fraud has already occurred.

Transparency as a Deterrent

Public disclosure will be essential.

The government should make the audit’s findings available, subject to legitimate security and privacy considerations.

Citizens should know the scale of the problem, the amount recovered or prevented from being lost, the institutions affected and the reforms adopted.

Transparency would also help distinguish genuine institutional reform from another cycle of arrests followed by administrative silence.

The Real Test

Nigeria has already demonstrated that it can discover payroll fraud.

The recurring problem is what happens afterwards.

Ghost workers are removed. Savings are announced. Suspects are investigated. Attention moves elsewhere. Eventually, another scheme appears.

The current controversy offers an opportunity to break that cycle.

The objective should not simply be a cleaner payroll.

It should be a public-finance system in which no fictitious employee, agency or financial identity can enter government records without leaving a verifiable trail.

For Nigeria, that is the real test of digital governance: not whether the government has sophisticated systems, but whether those systems can withstand the people authorised to operate them.