Financial Crime World

Nigeria Introduces Stringent Anti-Terrorism Financing Regulations

In an effort to combat terrorism financing in Nigeria, the country has introduced several regulations aimed at preventing the misuse of financial systems by terrorist organizations. The new regulations are part of efforts to strengthen the nation’s anti-money laundering (AML) and combating the financing of terrorism (CFT) framework.

New Regulations

The Economic and Financial Crimes Commission (EFCC) has issued the “Economic and Financial Crimes Commission (Anti-Money Laundering, Combating the Financing of Terrorism and Countering Proliferation Financing of Weapons of Mass Destruction for Designated Non-Financial Businesses and Professions, and Other Related Matters) Regulations, 2022”. These regulations require financial institutions to implement measures to prevent terrorist financing, including:

  • Customer due diligence
  • Reporting suspicious transactions
  • Monitoring accounts

Central Bank of Nigeria (CBN) Regulations

The CBN has also issued several regulations aimed at preventing money laundering and terrorist financing. These include:

  • “Central Bank of Nigeria Anti-Money Laundering, Combating the Financing of Terrorism and Countering Proliferation Financing of Weapons of Mass Destruction in Financial Institutions Regulations, 2022”
  • “CBN Administrative Sanctions Regulations, 2018”

The CBN regulations require financial institutions to implement AML/CFT measures, including:

  • Customer due diligence
  • Reporting suspicious transactions
  • Monitoring accounts

Additionally, the regulations provide for administrative sanctions for non-compliance.

Securities and Exchange Commission (SEC) Regulations

The SEC has issued the “Securities and Exchange Commission (Capital Market Operators Anti-Money Laundering and Combating the Financing of Terrorism) Regulations, 2022”. These regulations require capital market operators to implement AML/CFT measures, including:

  • Customer due diligence
  • Reporting suspicious transactions
  • Monitoring accounts

International Reactions

The government’s efforts to combat terrorism financing have been welcomed by international organizations, which have praised Nigeria’s commitment to preventing the misuse of financial systems. The new regulations are expected to significantly enhance the country’s AML/CFT framework and help prevent terrorist financing.

Guidance Notes on Politically Exposed Persons (PEPs)

In related news, the Central Bank of Nigeria has issued guidance notes on PEPs, aimed at helping financial institutions identify and manage PEPs’ transactions. The guidance notes provide clarity on:

  • Definition of PEPs
  • Their risks
  • Measures required to mitigate those risks