OrderPaperToday – President Muhammadu Buhari‘s assent to the Money Laundering (Prevention and Prohibition) Bill recently passed by the National Assembly might just be a breath of fresh air for a country neck-deep in corruption.
As we well know, the issue of corruption and money laundering are intertwined and it happens to be one of the factors used to measure the depth of the scourge in Nigeria.
The bill which emanated from the Executive is a sequel to the repealed Money Laundering Prohibition Act 2011 and aims at providing comprehensive legal and institutional framework for the prevention and prohibition of money laundering in Nigeria.
A major provision of the bill prohibits a citizen or foreigner from making or accepting cash payment of a sum exceeding N5 million or its equivalent while a corporate entity can no longer make or pay the sum of N10 million or its equivalent.
Another dimension of the Money Laundering Act is the provision that makes it mandatory for banks and other financial institutions to report any single transaction or lodgement exceeding the above amount in writing to the Special Control Unit Against Money Laundering under the Economic and Financial Crimes Commission (EFCC).
As stipulated in the legislation, specific provisions for financial institutions or designated non-financial businesses and professions to provide for appropriate risk management systems and procedures to mitigate the risk posed by domestic and foreign politically exposed persons.
Others include any person who has been entrusted with any prominent function by an international organisation, as well as casino business including internet casinos and ship-based casinos.
As defined by the Act, the Politically Exposed Persons (PEPs) includes individuals who are or have been entrusted with prominent public functions by a foreign country, for example, Heads of State or Government, senior politicians, senior government, judicial or military officials, senior executives of State-owned corporations and important political party officials.
Others are Senior Executives of State-owned corporations and important political party officials; and persons who are or have been entrusted with a prominent function by an international organisation; including members of senior management such as directors, deputy directors, and members of the Board or equivalent functions and their family members and close associates, other than middle-ranking or more junior individuals in the foregoing categories.
The Designated Non-Financial Business and Profession include – automotive dealers; businesses involved in the hospitality industry; casinos; clearing and settlement companies; consultants and consulting companies; dealers in jewelry; dealers in mechanised farming equipment, farming equipment, and machinery;
Dealers in precious metals and precious stones; dealers in real estate, estate developers, estate agents, and brokers; high-value dealers; hotels; legal practitioners and notaries; licensed professional accountants; mortgage brokers; practitioners of mechanised farming; supermarkets; tax consultants; trust and company service providers; pools betting, among others.
The piece of legislation further forbids an individual to conduct two or more transactions separately with one or more financial institutions or designated non-financial businesses and professions with the intent to avoid the duty to report a transaction that should be reported under this Act; breach the duty to disclose information under the act by any other means.
The Bill provides in Section 11(3) that: “any Financial Institution or Designated Non-Financial Business and Profession that contravenes the provisions of this section commits an offence and is liable on conviction to a fine of not less than N250,000 and not more than N1 million for each day the contravention continues.”
Section 12 prohibits the opening of numbered or anonymous accounts in fictitious names and shell banks.
It provides that any person or financial institution that contravenes the provisions of Section 12 subsections (1), (2), and (3) commits an offence and is liable to imprisonment of not less than two years and not more than five years in the case of an individual;
And a fine of not less than N10 million but not more than N50 million for a Financial Institution, in addition to the prosecution of the principal officers of the body, and winding up and prohibition of its constitution or incorporation.
READ ALSO: How money laundering connects to terrorism
Meanwhile, Chairman of Media and Publicity of the House of Representatives, Benjamin Kalu at a forum while briefing journalists, explained that the Economic and Financial Crimes Commission (EFCC) has been given the tooth to bite.
“The EFCC would be better equipped in handling issues concerning money laundering now. This law which we handled today would fill up the gaps that had hitherto existed in the 2011 Act. It is a better law that we have put together.
As you know the Public Complaints Commission before now had not been in the right teeth to bite. They have been seen not to be so instrumental.
There is another one that has to do with the confiscation of properties suspected to be from proceeds of crime.
The EFCC again has been given more powers to that effect. This is to sanitise the space especially as it concerns corruption. This is to show Nigerians and the world that this government is committed to fighting corruption by laying this framework upon which we can build,” Kalu stated.
President Muhamadu Buhari had transmitted the Money Laundering, Terrorism Prevention bills, and others to the House for consideration and passage into law last month.
Buhari said the bills seek to address the deficiencies in Nigeria’s anti-money laundering and terrorism laws to meet contemporary demands and global best practices.
“During the recent mutual evaluation carried out by the Inter-Governmental Action Group (GIABA) against money laundering in West Africa, observed deficiency in Nigeria’s anti-money laundering fight; combating (terrorism).
Following the review, the Ministry of Justice and relevant stakeholders reviewed the said deficiencies and drafted the Money Laundering Bill 2022 and Terrorism Bill 2022.
Unless these deficiencies are addressed promptly by the National Assembly in order to bring the legal regime in conformity with the United Action Task Force recommendation, Nigeria will face the risk of negative public statement; blacklisting the country by the financial action task force, and this will lead to some negative consequences to our rapidly growing economy.”
Meanwhile, the Inter-Governmental Action Group against Money Laundering (GIABA) which is a specialised institution of the Economic Community of West African States (ECOWAS) body that promotes policies to protect member States’ financial systems against money laundering, terrorist financing, and the financing of the proliferation of weapons of mass destruction in Africa in its 2019 Annual Report, indicted agencies of government saddled with the responsibility of ensuring the prevention and prosecution of money launderers.
According to the report published on its website, “Several agencies are designated to investigate and prosecute money laundering cases.
However, there is limited or lack of coordination among these agencies. The Economic and Financial Crimes Commission (EFCC), does not prioritise money laundering investigations and focuses primarily on money laundering predicated offences.”
“There are also technical compliance deficiencies. As a result, stand-alone money laundering offences are not pursued, nor are those related to foreign predicate offences. The number of investigations, prosecutions, and convictions for money laundering is inconsistent with the risk profile of the country.
There is no reliable data to determine if the sanctions applied to natural and legal persons for Money Laundering, are proportionate and dissuasive.
Nigeria lacks an explicit policy to confiscate the proceeds and instrumentalities of crime or property of equivalent value. The country did not demonstrate effective seizure and confiscation of all types of proceeds and instrumentalities of crime, including TF (Terrorism Financing).
The legal framework is deficient in asset-sharing and formal arrangements for asset sharing with foreign countries for purposes of restitution.
The authorities have not effectively utilised the physical cross-border declaration system to seize or confiscate falsely declared or undeclared currency and bearer negotiable instruments.
The bill as signed is expected to stem corruption amongst government officials and other corporate entities.