Money laundering: FATF places Nigeria under increased monitoring
The Financial Action Task Force (FATF) has placed Nigeria under increased monitoring also known as the ‘grey list’.
The country is being monitored to see how well and quickly it addresses cases of money laundering, terrorist financing, and proliferation financing.
The FATF on its website, on Friday, said Nigeria and South Africa are the latest countries to come under its increased monitoring (grey list) programme in February 2023.
According to FATF, “Nigeria made a high-level political commitment to work with the FATF and GIABA to strengthen the effectiveness of its Anti-Money Laundering/Combating the Financing of Terrorism (AML/CFT) regime.”
Since August 2021, when Nigeria adopted the Mutual Evaluation Report (MER), the FATF admitted that the country “has made progress on some of the MER’s recommended actions to improve its system.”
Some of the progress recorded include “improving its AML/CFT legislative framework, updating its assessment of inherent ML/TF/PF risks, and strengthening its implementation of targeted financial sanctions.
With Nigeria now under increased monitoring, the country will have to implement its FATF action plan by completing its residual ML/TF risk assessment and updating its national AML/CFT strategy to ensure alignment with other national strategies relevant to high-risk predicate offenses.
The country will also have to enhance formal and informal international cooperation in line with ML/TF risks; improve AML/CFT risk-based supervision of Financial Institutions (FIs), Designated Non-Financial Businesses and Professions (DNFBPs), and enhance implementation of preventive measures for high-risk sectors.
It must ensure that competent authorities have timely access to accurate and up-to-date Beneficial Ownership (BO) information on legal persons and apply sanctions for breaches of BO obligations.
Going forward, Nigeria must demonstrate an increase in the dissemination of financial intelligence by the Financial Intelligence Unit (FIU); proactively detect violations of currency declaration obligations, and apply appropriate sanctions as well as maintain comprehensive data on frozen, seized, confiscated, and disposed assets.
According to the FATF, the consequences of the increased monitoring “will also be felt on the state level when it comes to seeking credit or borrowing from multilateral organisations and international financial institutions.”
To prevent governors, ministers, and other public office holders from last-minute cash withdrawals, the federal government through the Nigerian Financial Intelligence Unit (NFIU) has activated the Egmont Secured Web (ESW) protocol to share information with 167 countries if any public official is flagged for money laundering.
(TNT)
