Nigerian financial institutions were recently saved from imminent blockade by the European countries rooting for the nation’s jugular
in an expanded list of blacklisted countries .
The grouse was that Nigeria belongs to the cartel of third world countries identified by the European Union (EU) as jurisdictions where money laundering and terrorism financing are allowed to flourish.
According to the EU Commission, the blacklist would affect countries that failed to take steps to strengthen their anti-money laundering and terrorism financing regimes.
The listing, if it scaled through, would mean stricter caution in financial transactions involving the named countries.
It would also mean all EU banks and governments would apply extra caution or block dealings involving the affected territories.
The proposed sanctions struck a semblance with the ordeal of the nation’s banks before Nigeria’s admission into the Egmont Group in 2007.
Then, the Nigerian banks were black book of the Group. This prevented them from engaging in correspondent banking with foreign institutions and access to foreign credit cards.
When the Egmont Group again threatened to expel Nigeria last year, many feared that that ominuous cloud, if allowed to burst, might spell a doom for the banks.
One it would have affected the issuance of Mastercard , Visa credit and debit cards by the banks.
The international rating of these financial institutions would have been badly hit while their access to some big-ticket international transactions would have been a pipe dream.
The Heads of Financial Intelligence Units (FIU ) made a decision, by consensus, to suspend the membership status of the Nigeria Financial Intelligence Unit (NFIU),
Nigeria, following repeated failures on the part of the NFIU to address concerns.
To avert this calamity, the Federal Government had to take urgent steps to address their grievances.
These included compliance with the group’s demands for a legal framework granting autonomy to the Nigeria Financial Intelligence Unit (NFIU) as announced by the acting Chairman of EFCC, Mr. Ibrahim Magu.
He was quoted as saying:
“We have allowed NFIU to go. They are operationally autonomous and independent of EFCC. They will be independent of EFCC. We have given them financial autonomy. N800million was proposed for the agency in 2018 budget.”
Earlier, the Senate had passed a resolution to make a law granting autonomy to the NFIU to avoid the country’s expulsion from the group.
And in a letter dated January 7, 2019 to the Senate, President Buhari appointed Modibbo Hamman-Tukur as the Director of the NFIU In accordance with the provision of Section 5(1) of the Nigerian Financial Intelligence Unit Act 2018.
It was reported that the transparency of the Federal Government in complying with the Egmont’s Group demands that saved the day.
Member states of the Financial Action Task Force (FATF) discussed the EU’s submission at their plenary in Paris, with the United States spearheading the call to disregard the Nigeria’s blacklisting.
It was also revealed that non-EU states took turns to lampoon the decision, with the U.S. describing it as “out of order and confusing”.
FATF’s president, Billingslea Marshall, announced the U.S. government’s directive to all U.S. banks to ignore the EU listing of the 23 countries.
Countries like Japan, Argentina and others from Africa and the Middle-East agreed with the U.S.’s position on the blacklist. Most members at the meeting faulted the EU’s position which, they said, was taken outside the known global mechanism for tackling illegal monies such as the FATF, Egmont Group and the UNODC.
The U.S. had to acknowledge that Nigeria was assessed and readmitted into the Egmont Group of Financial Intelligence Units.
The FATF president, who recognised Nigeria as the first West African Country to be at FATF to represent West African sub region, said the country is processing FATF Membership with full commitment.
He stressed that the FATF is waiting for the Nigerian government to pass two major bills; the Mutual Legal Assistance Bill (MLA) and the Proceeds of Crime Bill (POCA), to enable it proceed with the membership accreditation.
He told the plenary that once Nigeria passes the bills, they will join the FATF as Associate Member, where 15 European countries are permanent members.
Though the E.U defended itself that the listing is subject to final vote of its member states at a future date, the FATF Plenary said its position remains the same.
The EU Commissioner for Justice, Consumers and Gender Equality, Vera Jourová, said the list is an update of third world countries which the EU identified earlier as jurisdictions where money laundering and terrorism financing are allowed to flourish.
The new listing, it was gathered, was a direct response to the assessment of the impact of the International Consortium of Investigative Journalists’ Panama Papers investigation. The global investigations, which spanned over a year, were conducted by over 100 media organisations across the world.
The investigations, which covered financial transactions of various offshore entities, exposed hundreds of companies linked to more than 140 politicians, businessmen and world leaders in more than 50 countries.
The commission said the new list followed a review of the process of these third world countries with strategic deficiencies in their anti-money laundering and counter-terrorism financing frameworks.