NIFU Seeks Close Collaboration On Suspicious Transaction Reporting

By Nana Musa-Umar

The Nigerian Financial Intelligence Unit (NFIU) has called for effective collaboration between public and private sectors in reporting Suspicious Transaction Report (STR) in combating money laundering and terrorism financing in Nigeria.

Hauwa Faruq, Head, Country Assessment and Standards, Nigeria NFIU, made the call during a one-day capacity building for high-risk financial institutions and Designated Non-Financial Business and Profession (DNFBPs) Sectors in Abuja.

Faruq, in her presentation titled “Exiting the Greylist: Challenges in Demonstrating Effectiveness”, said that Nigeria could only exit the International Cooperation Review Group (ICRG) process if both sectors work together.

The programme was organised by the NFIU with the support of the Rule of Law and Anti-Corruption (RoLAC) programme, a project funded by the European Union (EU) and implemented by the International Institute for Democracy and Electoral Assistance (International IDEA), for reporting entities from high-risk sectors (except banks) on improving risk understanding and filing STRs.

She said that both sectors needed to work together on Anti-Money Laundering (AML), Combating the Financing of Terrorism (CFT) and Conferring Proliferation Financing (CPF), especially on 15 strategic areas still needed to be addressed for Nigeria to be delisted from the ICRG.

Faruq listed some of the challenges confronting Nigeria to include management commitment, lack of effective cooperation and collaboration, and poor record keeping in Suspicious Transaction Report (STR).

She said that the process required all stakeholders to work closer, the whole penal process is like a chain and your work affects that of the next person.

On poor record keeping challenge, Faruq said it was not enough to have the processes and procedures, it must be shown to be implemented with supporting evidence with data and statistics.

“The role of reporting entities as gatekeepers in the AML, CFT and CPF regime cannot be overemphasised.

“Detection of Money Laundering (ML), Terrorist Financing (TF) and Proliferation of Weapons of Mass Destruction (PF) and associate offences starts with the reporting entities.

“Nigeria can only exit the ICRG process if the public and private sectors work together to strengthen the effectiveness of the country’s AML/CFT/CPF regime,” she said.

Felix Obiamalu, Associate Director, Legal and Sanctions of NFIU, said that Nigeria as a major player in African economy, had taken significant steps to improve its reporting culture in recent years.

Obiamalu said that Nigeria recognised the crucial role of transparent and accurate reporting in building investors confidence and fostering economic development in the country.

“Nigerian government has implemented new legislative measures aimed at enhancing compliance and reporting practices,” he said.

Obiamalu said that it was important to report because of transparency and accountability in the financial system, investor confidence and economy growth, and reduce the flow of illicit funds.

He said that was also important for corporate governance and stakeholders relations, compliance with legal and regulatory frameworks, performance evaluation and business improvement.

Obiamalu said that part of the challenges were absences or weak compliance structure, lack of capacity technological advancement in reporting and heavy reliance on cash transactions, and high exposure of informal operators.

“Lot of people have been reporting and it’s encouraging but a lot needs to be done like creating more awareness,” he said.

Mr Emmanuel Uche, the Anti-Corruption Component Manager, RoLAC, said that the seminar was very important.

Uche, who was represented by Mr Pwanakei Dala, RoLAC Anti-Corruption Programme Officer, said that the event was targeted at helping the DNBPS to better understand Nigeria’s risk context.

He said that it targets feedback on common errors in their reporting and establish risk indicators and red flags (especially the high-risk predicate offences).

“The workshop is organised for reporting entities from high-risk sectors like real estate operators, Bureaux De Change (BDCs) and Dealers in Precious Metals and Stones(DPMS) on improving risk understanding and filing Suspicious Transaction Report (STR), also to importance of reporting any illegal or suspicious transactions to the authorities.”

Uche said that the EU and IDEA are both committed to strengthening the foundations for strong, stable, peaceful and sustainable democracy in Nigeria.

“The one that can allow all Nigeria to aspire to their highest dreams and potentials,” he stated.

He said that dream of Nigeria may remain an illusion unless the socio-economic systems are strengthened to become more transparent, accountable and responsible.

“To achieve this, all parties must up their games and enforce increased compliance and oversight of their respective spheres of authority.

“This requires increased capacity and awareness of the dangers that a failure on their part constitutes for our collective survival and wellbeing,” Uche said.

He said that RoLAC with the support of NFIU and other stakeholders would replicate these efforts across the six geopolitical zones in the country.

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