CBN Goes Tough Over Money Laundering

THE Central Bank of Nigeria (CBN) has called on all financial institutions to comply with the strict standards of record keeping drawn up by the Financial Action Task Force (FATF), if the sector is to win the battle against Money Laundering (ML) and Financing Terror (FT).
Speaking during a presentation at the money laundering workshop organised by the Chartered Institute of Bankers of Nigeria (CIBN), the Director, Banking Supervision at the apex bank, Mrs. Tokunboh Martins, said; “the prevention of ML and FT can only be possible where financial institutions maintain appropriate records of their customers’ identities, transaction documents with seamless retrieval process.
“Consequently, suitable record keeping is basically a fundamental tool for combating money laundering. These mandatory requirements are deliberate measures aimed at ensuring proper audit trail of financial transactions as well as dissuade persons or organisations who intend to launder monies through the financial system.”
She pointed out that record keeping was critical because agencies such as the Economic and Financial Crimes Commission (EFCC) require documentary evidence in civil and criminal prosecutions involving money laundering.
The CBN Director also stated that financial institutions are required to maintain, for at least five years, all necessary records on transactions, both domestic and international, to enable them comply swiftly with information requests from competent authorities.
She explained that such records must be adequate to permit reconstruction of individual transactions so as to provide, if necessary, evidence for prosecution of criminal activity.
“The fight against ML and FT cannot succeed without a robust system of gathering and analysing data. The laws and regulations relating to rendition of returns and maintenance of records under money laundering are derived from the FATF 40 recommendations revised in 2012.
“Recommendation 5-12 addresses customer due diligence and record keeping while 13¬16 addresses reporting of suspicious transactions and compliance. The (Money Laundering Prohibition Act (MLPA), 2011 and CBN AML/CFT Regulation, 2013 also provides the requirements for record keeping and reporting. The duties of banks with respect to reporting are clearly stated in Section 2, 6 and 10 of the MLPA 2011 (as amended).” The CBN Director however, noted that increased efforts by Nigeria to combat ML/FT have yielded results as the FATF removed Nigeria from the list of countries identified as jurisdictions with significant deficiencies in their (AML/CFT) regimes.