Things You Should Know About The Nigerian Money Laundering Act
My aim here is not to analysis the Act section after section. Rather to present you with some basic facts which are of importance as a citizen.
Money laundering is the process of concealing money obtained from illegal activity. In Nigeria, the money laundering (Prohibition) Act 2011 checkmates this act of laundering.
For an act to constitute a breach of this Act, the money must have been obtained in an unlawful act. Mark the word, “Unlawful Act.”
Let me quickly explain the term ‘Unlawful act’ to includes – taking part in an organized criminal group, trafficking in persons, illicit trafficking in narcotic drugs, racketeering, corruption, bribery, terrorism, terrorist financing, kidnapping, hostage-taking, smuggling of migrants, sexual exploitation, sexual exploitation of children, and psychotropic substances, illicit arms trafficking, fraud, currency counterfeiting, counterfeiting and piracy of products, environmental crimes, murder, grievous bodily injury, robbery or theft, smuggling (including in relation to customs and excise duties and taxes), illicit trafficking in stolen goods, 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
Here are things you should know about money laundering in Nigeria
Cap on Cash Transactions
It is illegal, an offense for you to make or receive cash payment exceeding N5, 000, 000 (Five Million Naira). So, if you want to receive any money exceeding N5, 000, 000 in Nigeria, it should be paid into your bank account. Anything apart from that is an offense.
Any once found of going against this law, you will be liable to not less than 3 years imprisonment or a fine of N10, 000, 000 (Ten Million Naira). And in some cases, you may be liable to both.
Declaration when transporting cash overseas
The Act has made it mandatory for you to declare the exact amount of money you are sending or traveling abroad with if the money is above US$10,000, or its equivalent. This you must do with the Nigerian Customs Service.
Also, this law covers negotiable instruments. A negotiable instrument is a document guaranteeing the payment of a specific amount of money, either on-demand or at a set time, with the payer usually named on the document. So, if the money to be redeemed by the negotiable document is above US$10,000, it must be declared.
Non-compliance with this law is an offense punishable upon conviction by you forfeiting the money or to the imprisonment of not less than 2 years. And in some cases, you may be imprisoned and still forfeit the money.
Gambling in a Casino
If you operate a casino office in Nigeria, you need to pay attention to this. According to the money laundering Act, provides that the identity of customers be verified and all transactions concerning the customer to be recorded as well and stored for at least 5 years.
The information of the customer to be recorded includes both the amount of money he/she plays the game with.
Data Retention by Financial Institutions and Designated Non-Financial Institutions
What this means is that your bank is mandated by law to keep your record even after you have closed your account with them for at least 5 years.
So, irrespective of whether you have an active account, the above institutions are duty-bound to keep your record accurately for 5 years.
Obligation to report to the Economic and Financial Crimes Commission (EFCC)
In line with the wordings of the Act, financial houses are compelled to report to the Economic and Financial Crime Commission (EFCC) of any transaction made by an individual in exceed of N5, 000, 000 within seven days.
So, rest assured that your transactions are seen by EFCC.
Numbered or Anonymous Accounts
The financial institutions will no longer be able to shield the identity of its customers. According to the Money Laundering (Prohibition) Act, it becomes a contravention of the Act to open and maintain an anonymous account in Nigeria. Anonymous account is otherwise known as a numbered bank account. And this kind of account offers a shield to the personality of the individual that owns the account. All transactions carried out on this kind of account are kept secret the account holder is kept secret, and they identify themselves to the bank using a code word known only by the account holder and a restricted number of bank employees, thus providing account holders with anonymity in their financial transactions.
The offender is liable on conviction to a term of not less than 7 years but not more than 14 years imprisonment.
Agent, Conspirators, and Accessories
You must understand that it’s a crime for you to carry out any of the prohibited acts on behalf of another person and vice versa when you know that the other person is or suspect the other person to be involved in such activities.
Such conduct makes you liable upon conviction for not less than 5 years jail term or to pay a fine equivalent to 5 times the value of the money involved in the criminal act, and in some cases, both fine and imprisonment.
The money laundering act is a way of curbing fraudulent transactions by phony individuals. The Act further states that it is an offense to conspire, abet, aid, procure, incite, induce or counsel any other person to commit any of the Money Laundering crime.