Nigeria

Nigeria

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Country contact

Feyisikemi K. Adeagbo
Sofunde, Osakwe, Ogundipe & Belgore
7th Floor, St. Nicholas House
Catholic Mission Street
Lagos, Nigeria
Tel.: (+234 1) 462 2502
Fax: (+234 1) 462 2501
fkadeagbo@sooblaw.com
www.sooblaw.com

At the present time, there is no central reporting authority for lawyers in Nigeria. This is because in 2014, in an action brought by the Nigerian Bar Association, a court struck down the requirement that lawyers, having been included in the definition of “designated non financial institutions” (DNFIs), comply with reporting obligations laid down for DNFIs under the Money Laundering (Prohibition) Act, 2011. An appeal by the Central Bank of Nigeria (CBN), which had sought to prevent DNFIs that were not registered with the central authority – the Special Control Unit against Money Laundering (SCUML) – from operating bank accounts, to the Court of Appeal failed. The CBN has filed a further appeal to the Supreme Court.

Money laundering is not defined in any legislation in Nigeria. However, section 15(1) of the Money Laundering (Prohibition) Act, 2011 prohibits money laundering and makes it an offence for any person to:

(a) control or disguise the origin of;

(b) convert or transfer;

(c) remove from Nigeria; or

(d) acquire, use, retain or take possession of such fund or property that the person knew or ought reasonably to have known “is or forms part of the proceeds of an unlawful act”.

The Money Laundering (Prohibition) Act, 2011 created numerous offences. Apart from those listed under 2 above, it is an offence to, other than through a financial institution, make or accept cash payments exceeding N5,000,000.00 or its equivalent, in the case of an individual and N10,000,000.00 in the case of a body corporate. The “unlawful act” referred to in section 15(1) is also stated to include “participation in an organized criminal group, racketeering, terrorism, terrorist financing, trafficking in persons, smuggling of migrants, sexual exploitation, sexual exploitation of children, illicit trafficking in narcotic drugs and psychotropic substances, illicit arms trafficking, illicit trafficking in stolen goods, corruption, bribery, fraud, currency counterfeiting, counterfeiting and piracy of products, environmental crimes, murder, grievous bodily injury, kidnapping, hostage taking, robbery or theft, smuggling (including in relation to customs and excise duties and taxes), tax crimes (related to direct taxes and indirect taxes), taxes crimes (related to direct taxes and indirect taxes) extortion, forgery, piracy, insider trading and market manipulation or any other criminal act specified in this Act or any other law in Nigeria”.

The bodies specifically stated in the Money Laundering (Prohibition) Act, 2011 are the National Drug Law Enforcement Agency, the CBN, the Economic and Financial Crimes Commission (EFCC), the National Financial Intelligence Unit (NFIU) and the Federal Ministry of Commerce. The SCUML, referred to at 1 above, is an inter-agency and ministerial body that works in collaboration with the EFCC (the coordinating agency for Nigeria’s AML/CFT regime) and the NFIU.

  • Money Laundering (Prohibition) Act, 2011.
  • Economic Financial Crimes Commission (EFCC)
  • Central Bank of Nigeria (Anti-Money Laundering and Combating the Financing of Terrorism in Banks and Other Financial Institutions in Nigeria) Regulations.

The above are all of general application, with none specifically applicable to lawyers, who have been excluded from the definition of DNFIs in the Money Laundering (Prohibition) Act, 2011.

Visiting lawyers are not permitted, save where they have been called to the Nigerian Bar and enrolled or otherwise permitted by the Chief Justice of Nigeria, to practice as lawyers in Nigeria. The local laws of general application apply to visiting lawyers as they do to all persons physically in Nigeria.

Reporting obligations apply to financial institutions and DNFIs, which include “Accountants and Accounting firms; Trust and Company Services Providers; Estate Surveyors and Valuers; Business outfits dealing in Jewelleries; Car Dealers; Dealers in Luxury Goods; Chartered Accountants; Audit Firms; Tax Consultants; Clearing and Settlement Companies; Hotels; Casinos; Supermarkets; Dealers in Precious Stones and Metals; Dealers in Real Estate Developers, Estate Agents and Brokers; Hospitality Industry; Consultants and Consulting Companies; Importers and Dealers in Cars or any other Automobiles; Dealers in Mechanized Farming Equipment and Machineries; Practitioners of Mechanized Farming; and Non-Governmental Organizations and any other business(es) as may be designated from time to time by the Federal Ministry of Trade and Investment.”

There is, presently, no money laundering guidance in place for lawyers. However, following the decision of the court referred to in 1 above, the NBA is believed to be working on money laundering guidance for its members.

At present the NBA is not involved in the supervision or enforcement of compliance by lawyers with Anti-Money Laundering Regulations. However, as stated above, it is believed that there are plans to put in place a programme that will include AML Regulations in the general supervision of the profession and the enforcement of rules of professional conduct.

There are, at present, no legal requirements for lawyers and law firms to appoint MLROs. Most law firms do not appoint MLROs, although those registered with the Securities and Exchange Commission are required to appoint compliance officers to ensure compliance with AML regulations.

Following the decision in the action referred to in 1 above, the Money Laundering (Prohibition) Act, 2011 do not apply to lawyers and the rules of professional conduct do not, presently, place any CDD obligations upon lawyers.

No CDD obligations are presently placed on lawyers.

Nigerian laws do not permit the use of bearer shares. Nominee beneficial share ownership is permitted but its use is not prevalent.

No CDD obligations are presently placed on lawyers.

No. Following the decision in the action referred to in 1 above, no FATF stipulated provisions apply to lawyers in Nigeria.

A lawyer is not under any obligation to report suspicious transactions.

A lawyer is not under any obligation to report suspicious transactions.

Lawyers in Nigeria are under no legal or professional obligation to inquire into sources of wealth of clients.

Lawyers in Nigeria are under no legal or professional obligation to inquire into sources of funds of clients.

  • International passport
  • Driving licence
  • National Identification Card
  • Bank statements
  • Utility bills

Certificate of Incorporation or of Registration from the Corporate Affairs Commission.

Lawyers, acting as lawyers, are not affected by AML legislation following the decision in the action referred to in 1 above.

A number of high-profile lawyers have been implicated in money laundering complaints, arrests and prosecutions. These have not been as a result of their being lawyers, but as a result of acts in respect of which other people would have been subject to action under the AML legislation.

Nigeria is not subject to FATF evaluations. However, such evaluations are conducted by the Inter-Governmental Action Group against Money Laundering in West Africa known by its French acronym (GIABA). GIABA is an institution of the Economic Community of West African States (ECOWAS) responsible for facilitating the adoption and implementation of Anti-Money Laundering (AML) and Counter-Financing of Terrorism (CFT) in West Africa. It is also a FATF-Styled Regional Body (FSRB) working with its member States to ensure compliance with international AML/CFT standards. GIABA’s Seventh Follow up Mutual Evaluation Report for Nigeria was issued in May 2015.

If yes, what were the findings concerning Lawyers' compliance with the FATF 40+9 recommendations?

The Mutual Evaluation Report for Nigeria issued in May 2015 did not address lawyers’ compliance with the FATF 40+9 recommendations.

Since lawyers in Nigeria have not been subject to AML regulations since December 2014, there have been no STRs made to any authority within the past 12 months.