The NFIU Act and matters arising – Thisday

The government should urgently submit the act to the Egmont group

Last week, President Muhammadu Buhari assented to the Nigeria Financial Intelligence Unit (NFIU) Act, 2018. The law establishes a legal framework for a national centre that will be responsible for the receipt and analysis of information from financial institutions and designated non-financial institutions, for the purpose of generating and disseminating intelligence to all law enforcement agencies and other competent persons. While the absence of a legal framework for financial intelligence unit and lack of operational and financial autonomy, among others were problems in the past, the situation has been redressed with the law.

However, having a law in place is one thing, ensuring effective implementation is even more important. The next thing the president must do urgently is to send the name of a fit and proper person to the National Assembly as head of the unit for consideration while putting in place the necessary structure for a functional agency that will be able to discharge its responsibilities. The 2018 act provides the NFIU with operational independence and autonomy and greater ability to provide financial intelligence to all competent authorities in order to strengthen anti-money laundering and combat the financing of terrorism (AML/CFT) measures.

The NFIU was set up in 2006 as part of the efforts to combat money laundering and the financing of terrorist activities in Nigeria, and as a pre-condition for the removal of Nigeria from the Financial Action Task Force (FATF) list of non-cooperation countries and territories (NCCTs).  The deficiency identified by the international community is the absence of operational autonomy, confidentiality and a legal framework.

The mandate of the new NFIU is to receive and collect currency transaction reports (CTRs) as well as suspicious transactions reports (STRs) and other information relevant to the money laundering and terrorist financing activities from financial institutions and designated non-financial institutions. The unit will also receive reports on cross-border movement of currency and monetary instruments; analyse and assess the information and reports it receives; conduct mandatory review of supervisory reports and criminal referrals; maintain a comprehensive financial intelligence database for information collection and exchange intelligence with counterpart FIUs and law enforcement agencies around the world. All of these, while maintaining a network with the regulatory authorities and law enforcement authorities in Nigeria.

Other functions of the new NFIU will include: to advise the government and regulatory authorities on the prevention and combating of economic and financial crimes; liaise with compliance officers and ensure strong compliance culture in financial institutions; provide financial intelligence reports/statistics in the investigation and prosecution of offenders under the relevant laws; promote public awareness and understanding of matters relating to economic and financial crimes, money laundering and financing of terrorist activities and to trail money transactions in banks and other financial institutions.

However, it is important to highlight the fact that Nigeria remains suspended from the Egmont Group of FIUs, meaning that the country has not been receiving external financial intelligence since July, 2017 and this will remain in force until the suspension is lifted. Now that the NFIU bill is assented, the authorities must move quickly. As the Egmont Plenary holds in September 2018, the federal government must urgently submit the assented copy of the bill to the global body. It is better late than never.

In addition, the executive should work closely with the National Assembly to ensure the prompt passage of the following bills into law: the Proceeds of Crime-POCA; Mutual Assistance in Criminal Matters, the repeal and re-enactment of the Money Laundering Prevention and Prohibition Act and the Terrorism Prevention Act, as well as the Whistle Blowers/Witness Protection. These laws are necessary, if Nigeria must be taken seriously, particularly as the country prepares for an international mutual evaluation by the FATF in 2019.

 

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