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Role of National Financial Intelligence Unit

NFIU/DIRECTOR/CCOB -1/AUGUST/2012 1
WELCOME ADDRESS DELIVERED
BY
JULIET IBEKAKU, DIRECTOR, NIGERIAN
FINANCIAL INTELLIGENCE UNIT (NFIU)
AT
THE CHIEF COMPLIANCE OFFICERS OF BANKS
MEETING .
ABUJA, NIGERIA
AUGUST 23, 2012

NFIU/DIRECTOR/CCOB -1/AUGUST/2012 2
1. I must not fail to start this meeting by thanking all of
you in a special way for setting out ti me to participate in this
month Chief Compliance Officers of Banks  forum in Abuja. I
am aware that your daily schedules keep you extremely
busy as you seek to develop measures to comply with the
legal and regulatory regime on anti -money laundering and
combating terrorist f inancing (AML/CFT) as imposed by
national, regional and international standards. I am also
aware that you face various challenges in the
implementation of these regimes.
2. It is my responsibility and that of my team to reassure
you that we are here to help you get through those legal and
regulatory maze and to enhance compliance framework and
responsiveness across the banks. In this regard, permit me
to say a few words about where w e are coming from and
where I think we should be heading.
3. The discussion this morning c overs the role of the NFIU
and that of reporting entities within the AML/CFT regime in
Nigeria , and how we may achieve effective reporting to
enhance intelligence gathering for our law enforcement
officers.
Understanding the Role of the Nigerian Financial
Intelligence Unit ( NFIU )
4. The Nigerian FIU was first set up under the Economic
and Financ ial Crimes, 2004 Act 1. This was aimed first of all
to enable the EFCC oversee the enforcement of financial
crimes in Nigeria but broadly and in conformity with
contemporary international standards to enable the NFIU
perform the central role of receiving, a nalyzing and
disseminating  financial intelligence generated from
reports submitted by financial, non -financial institutions and

NFIU/DIRECTOR/CCOB -1/AUGUST/2012 3
designated non -financial businesses and professions
(DNBPs) 2.
5. In the same breath ,the Money Laundering Prohibition
Act (MLP ), 2004 , as amended in 2011 and the Prevention of
Terrorism Act (PTA), 2011 set out the obligations of various
regulators and reporting entities in ensuring that the NFIU
can and would receive suspicious transaction reports from
all the reporting entities as well as be able to request for
additional information when the need arises.
6. In 2006, the NFIU was formally established and has
since then sought to develop standards, perform onsite and
off -site examination of financial institutions, enhance
compliance with the legal and regulatory regimes on
AML/CFT in Nigeria as well as respond to the global trends
by collaborating with other FIUs worldwide . Indeed as a
member of the global EGMONT GROUP of FIUs 3with more
than 120 membership, the NFIU is not only a key player
from the African region, it is also sponsoring other regional
FIUs such as Ghana Financial Intelligence Center (GFIC) to
be be come member of the EGMONT Group.
7. The NFIU ,as part of its regulatory mandates, work s
closely with the Central Bank of Nigeria as the core regulator
for financial and non -financial institutions , inc luding money
service businesses in the regulation of the sector and
particularly in the receipt of the following reports:
(i) Report of international transfer of funds and
securities exceeding US$10,000.00 or naira
equivalent  Section . 2 (1) of the MLP
(ii) Suspicious Transaction Reports ( STRs ) related to
potential money laundering activities from reporting
entities or made voluntarily by any persons -
Section 6 (2) of the MLPA 2011 (exclusively to be
submitted to the NFIU to aid intelligence gathering)

NFIU/DIRECTOR/CCOB -1/AUGUST/2012 4
(iii) Decl arations of more than 10,000 USD threshold or
its equivalent made to the Nigerian Customs
pursuant to the Foreign Exchange Act, 1995 
Section 2 (3)
(iv) Currency Transaction Reports( CTRs ) made by
reporting entities  Section 10 of the MLPA 2011
(v) Application of freezing measures under Section 6 (5)
(b)
(vi) Mandatory Disclosures by financial institutions and
any other individual  related to single transaction,
lodgment or transfer of funds in excess of N5 ,
000,000 /N1 , 000,000 (individual) and N10 ,
000,000 /N5 , 000,000 (Corporate)  Section 10 (1)
and (2) , MLP Act
(vii) Determine the flow of transactions and the
beneficiaries for individual and corporate accounts 
Section 14 MLP Act
(viii) STRs on transactions that may relate to Terrorism -
Section 14 of the PTA 2011 ; and other
(ix) Ot her statutory reports mandated by the regulators.
8. In addition to all these function s, the NFIU will e nsure
that reporting entitiescomply with the various AML/CFT
obligations in the Nigerian laws through monitoring of the
compliance measures of banks .
Roles of Reporting Entities
9. The responsibility to take specific and timely action to
prevent the financial system from reputation and legal
damage rests mainly with the banks in the first instance
because of the nature of service and products they of fer to
their customers and because of the type of clientele they
serve. Accordingly, I have chosen this meeting to receive
feed back from you on the work of the NFIU and how you
think we may best add value to your compliance functions.

NFIU/DIRECTOR/CCOB -1/AUGUST/2012 5
10. The responsibili ties of the financial institutions in
relation to AML/CFT is well set out in th e EFCC Act, 2004
and the MLP Act as well as the Prevention of Terrorism Act,
2011 . Some of these responsibilities must be read alongside
other prudential responsibilities. They include but are not
limited to the following:
(i) In -depth understanding of regulatory and legal
AML/CFT regime in Nigeria and globally
(ii) Identification of customers and beneficial owners of
accounts or investments
(iii) Development and recording of all transaction
records as stipulated in the laws
(iv) Verification of customers  profile and documentation
of any suspicious or unusual transactions or trends
in customers  profile
(v) Development of central information collation system
or setting up of mini -fius on all bank tra nsactions
conducted by customers in order to systematically
identify red flags that may be reported to the NFIU.
(vi) Identification of suspicious transactions and
submission of all suspicious transactions to the NFIU
in a prompt and timely manner in order to aid the
combat of financial crimes, control the laundering of
illicit money and prevent the use of the financial
system by terrorists (without exception ) based on
the definition of the offence of money laundering
under Section 15 of the MLP Act, 2011 (anne x 1)
(vii) Training all staff (both front office and back office)
and ensuring effective supervision and compliance
by applying a risk -based approach ( Note that the
rules based approach is no longer applicable in
the examination of banks  AML/CFT compliance
syst em. Supervisors and the NFIU will seek to
examine targeted banks in order to ensure strict

NFIU/DIRECTOR/CCOB -1/AUGUST/2012 6
compliance with legal and regulatory AML/CFT
regime )-See Sections 3, 6,
(viii) Understand ing and apply ing appropriate risk
management systems in appropriate cases and as
provided by the laws.
Today, I will like to mention two specific areas where the
NFIU expects the banks to take immediate action to resolve.
Timely Submission of Suspicious Transactions:
11. In undertaking your tasks as compliance officers as
reflected under Section 3 (6) of the MLP A ct and Section 6 of
the MLP Act as well as the Section 14, PTA, we expect you to
bear in mind that you have been given a peculiar , unique but
specific responsibility to aid in fighting crime and to assist in
maintaining the integrity of the financial system. This is not
unusual as it is a responsibility that has been in place
globally since 1989 following the establishment of the
Financial Action Task Force, but even earlier than that, since
1970 in the United States when th e Bank Secrecy Act was
enacted. As most of you have had course to work with banks
in developed and most developing countries, you are well
aware of the strict application of not just the duty to conduct
due diligence on banks  customers but also the requir ement
to file suspicious reports to the NFIU.
12. Our expectation is that you will fulfill this role in a
prompt and timely manner . Our reading of the seven days
time limit to file a r eport is that this is a maximum threshold
that is only applicable in t he case of unusual transactions 
as opposed to suspicious transactions . Nigerian laws must
be read alongside contemporary jurisprudence as well as
international standards on AML/CFT . In submitting STRs,
we expect you not only to file immediately, we als o expect
confidential reporting and notification of the NFIU through

NFIU/DIRECTOR/CCOB -1/AUGUST/2012 7
the emai l or telephone contacts that have been provided to
you by the NFIU s Compliance and Enforcement Department.
We are also aware that compliance with the submission of
STRs across banks is poor.
13. We are also aware that some banks are not filing STRs
at all, and that some are either filing defensively or seeking
for excuses where none exist inorder not t o file. The NFIU
would like to reiterate that failing to file STRs is a crimi nal
offence which the NFIU will co mmence effective
enforcement of, working closely with its counterpart in the
law enforcement agencies. However, be assured , that we are
here to help you where you have genuine and verifiable
reasons to have failed in filin g a particular suspicious
conduct. In the next couple of days and in close collaboration
with the Central Bank, the NFIU intends to issue further
guidance on some of the emerging issues that we are seeing
in the exceptions that were recently highlighted by the
Compliance and Enforcement Department.
The development of Risk Management Systems
14. The MLP Act, Section 3 (8) (a) provides a requirement
for banks to establish appropriate risk management
systems  to enable the banks, in the first instance resp ond to
emerging trends in the handling of certain transactions,
particularly those involving public officials. It is important
fo r me to highlight that Section 3 was informed not just by
international standards but also the need to address
growing concerns in the management of public resources.
You are all aware of recent cases related to pension,
petroleum subsidy, and the prosecution of ex -governors. It is
our understanding that some of the withdrawals and
placement of public funds in private accounts wou ld not
have occurred without collaboration  by banks. We are well
aware of ongoing cases in the courts and we are examining
the roles that banks played by failing to report. As I said

NFIU/DIRECTOR/CCOB -1/AUGUST/2012 8
earlier, your duty is to report, where you fail to report or
tip -off  a potential suspect, you are coming within the
definition of Sections 15 (2) , 16 , 17 and 18 and you are
inevitably exposing yourselves and your banks to the legal
and reputational damage that may follow such an action.
15. I will not fail to add that you have both a legal and
professional obligation under the MLP and the PTA Acts. The
moral obligation is one that you will be confronted with as
citizens of this country when you fail to report the theft of
public funds and you fail to report the movement of funds
that may potentially support fraud, violence or terrorist
attacks.
16. I must also point out that regulators all over the world
are reviewing their regulatory remits inorder to ensure
greater enforcement and prevention of crimes, Nigeria as a
globa l player, will be looking at what is happening in the UK,
in particular and in the United States, in order to learn
lessons.
17. On this note, I wish to welcome you once again and
look forward to a lively and enlightening session today.
Thank you.
1Section 1 (2) (c) EFCC Act, 2004
2Section 46 of the EFCC Act, and Section 25 of the MLP Act, 2011
3http://www.egmontgroup.org/ and www.nfiu.gov.ng

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