BANKS and other financial institutions withholding illicit funds should be made to face the consequences of engaging in criminal conduct, Acting President Yemi Osinbajo has said.
Osinbajo made the recommendation yesterday in an address at the “Conference on Promoting International Cooperation in Combating Illicit Financial Flows and Enhancing Asset Recovery to Foster Sustainable Development” at the old Banquet Hall of the State House in Abuja.
According to the Acting President, public assests and funds’ looters are worse than drug traffickers.
He said those plundering the commonwealth were worse than perpetrators of crime against humanity.
The Acting President said: “It is a good thing that we are here with our partners who agree that not only are these stolen assets criminalised but that they are returned to their appropriate owners.
“There is no way the transfer of these assets can happen without a handshake between the countries that they are transferred to and the international banking institutions in those countries. There is no way it will happen without some form of connivance.
“We have to look at how to delegitimise the financial institutions involved in such transactions and criminalise them. The banks and financial institutions that actually engage in such acts should be called out and made to face the consequences of engaging in criminal practices. If that isn’t done, we are not likely to go very far.
“For there to be collaboration, there must first be connivance. In the agreement and conventions we will be signing, we must find a way and ensure that financial institutions are not given a free run but hold them accountable.”
He described as unacceptable a situation in which proceeds from political corruption do not attract the same outrage that proceeds from narcotics and trafficking in persons attract internationally.
Osinbajo said: “It took years for some people to agree that when somebody loot money where people make decent living that is more criminal than crime against humanity, more dangerous than trafficking in drugs.,
He said: “It took years for some people to agree that when somebody loot money where people make decent living, that is more criminal than crime against humanity, more dangerous than trafficking in drugs., “
African countries and developing countries, he said, must take it as their responsibility to find the funds and ensure their repatriation.
Noting that it was not enough to talk about the stolen funds, he described as unfortunate that some countries have been reluctant to return looted funds.
He also said many countries have civil processes that make it difficult to return stolen assets being kept in their domains.
Osinbajo said: “They say our courts are handling this matter and there is very little we can do about. – We must make it a national call, a call for other developing countries to have the same outrage for drugs, terrorist financing for illicit financial flows.
“We must emphasis at every point and call out institutions that are not cooperating and ensuring that they recognise that this for us is a serious issue.
“Like President Buhari has said repeatedly that if we don’t kill corruption, corruption will kill us. When corrupt funds find safe havens, it will begin to fight back; and if the government is not careful, it can fight back.,
“In Nigeria for instance, where corruption fights back so eloquently, the government itself, if not careful, can be overwhelmed.
“If you look at the anti-corruption fight in Nigeria, there is a major fight back in the media. There is a media war, between people fighting corruption and those behind the stolen funds.
“They call the anti-corruption crusade media trial. I don’t know what that means. If you discover for instance, large sums of money in an air conditioned room, there is no way it will not make news anywhere in the world.
“So, this whole idea of trying to legitimise corruption is definitely being fueled and sponsored by those who have these resources, those who have stolen funds.
“Unless we see it as a problem that can bring down our system, then we will never be able to fight it. I hope we will be able to advance this other African countries., “
He also pointed out that the report of the Thabo Mbeki’s High level panel on illicit financial flows” showed that Nigeria accounts for most of the illicit funds flow that comes out of Africa.
Osinbajo said: “And that shows us very clearly, especially security agencies that we simply have to do more. It is evident that so much money is leaving our shores.”
Recalling an encounter with a friend, he said: “- I was arguing with somebody about the fact that they were stopping certain funding, and he kept telling me Nigeria is no longer a poor country but now a mid-income earning country so, they shouldn’t be giving us those kinds of aids.
“It was barely a week after that a large sum of money was found at the Kaduna airport and it was roughly about half of the money we were looking for.
“So, he sent me a text telling me that the money has been discovered at Kaduna. Of course I didn’t reply him but, when he persisted and I called him and asked if this was his own form of a joke.
“But clearly, it is sometimes absurd that when we are asking for aid and so much money are being stolen. So, we ourselves must take responsibility and ensure we keep talking about this.”
In his remark, Justice Minister & Attorney-General of the Federation, Mr Abubakar Malami, said Nigeria had signed accords to ease investigation, tracking and return of stolen assets.
Malami said the country needed global support in those directions.
“The commitment to curb corruption is rooted in all programmes of the Muhammadu Buhari administration. The return of the country’s stolen assets will help Nigeria to quickly overcome recession”, Malami said.
In his keynote address, the Chairperson of International Anti-Corruption Conference Council, Akere Muna, called for a meeting to consider the recommendations in the Thabo Mbeki panel Report.
Muna is the Sanctions Commissioner at the African Development Bank (AfDB) and a member of the Mbeki-led High level panel on illicit financial flows from Africa.
Pushing for the creation of escrow accounts within AfDB, he said that frozen funds should not be allowed to domicile in complicit banks, but in an escrow account with a third party, pending the courts’ or competent authorities’ determination as to the rightful owners of the funds.
He said: “I have seen, in the context document prepared for the meeting, the issue of the management of recovered funds. I personally resent the fact that people who were complicit in the theft should turn around and start laying down conditionalities for the recovery of the same assets.
“Funds, whether recovered or still in the government coffers should not be stolen, period. The fact that for budgeting reasons, these may be earmarked for specific projects and under certain criteria, like the state or region from which the funds were stolen, is entirely a different matter for the countries themselves to decide in all sovereignty.
“All I have said underpins the fact that the fight is global and must necessarily be engaged by the originating countries and the destination countries with the same vigor”, Muna said.
He commended the President Buhari administration for making the fight against corruption its number one priority. Osinbajo stood him for the President.
His words: “The simple fact of your presence here is witness to this. It is not an easy choice. As you know or must have found out by now, when you fight corruption, it fights back.
“The fight against corruption in our continent is indeed the fight for the soul of Africa. How much longer will we watch our resources depleted and the future of our children mortgaged for the sake of a greedy few?”
Stressing that the winds of change are blowing across the African continent, he said that the young people, who know better and want better, deserve better.
“For those who feel that their own personal interest can always take precedence over that of their people, they should take a good look at history. We can certainly hide to do certain things, but it is certain that we will never be able to always hide the things we do”, he submitted.
He went further: “For illicit financial flows to be tracked, he said, that there is need to know how they move. To recuperate them, we need to know where these flows are parked.”
According to him, Transparency International (TI) research published in March 2017 looked at 10 key anti-money laundering measures for the real estate sector in four key markets, and found that Australia and the United States (U.S.) had severe deficiencies across their entire real estate sector.
He said: “In December last year, TI Canada found that of the 100 priciest homes in Vancouver, 46 were owned through offshore shell companies, trusts and nominees.
“In March (this year), TI UK looked at new developments in London worth 1.6 billion pounds and found that four in 10 homes have been sold to investors from high corruption-risk countries or those hiding behind anonymous companies.
“In April, TI Brazil found that in Sao Paulo, Brazil, $2.7 billion in property has been linked to offshore companies.
“In April, a TI Report on the luxury sector found that compliance by high-value good dealers with due diligence obligations is remarkably low. Legislation and policy also have weaknesses in the largest consumer luxury markets including the US, UK, France, China, Italy and Germany.
“Time and again, large-scale corruption cases show that the proceeds are laundered through luxury assets from cars and super yachts to jewellery and art.
“Think about the situation in Africa. I am sure many of you have noticed the sudden upturn in large-scale farming by people with no affinity to the soil, whatsoever.
“The reason for this is that it is a sector which is labor intensive and in which almost every transaction is done in cash. What is exported or sold thereafter is from an identifiable source. I suppose this is one way to harvest the fruits of corruption and create a green economy!
“It is still a mystery, what happens to funds between the time when they are frozen and the time when they are repatriated.
The World Bank has an initiative known as StAR (Stolen Assets Recovery Initiative), which is supposed to deal with the theft of stolen assets from developing countries. If these assets are described as stolen, inevitably therefore those who are keeping those assets are handlers of stolen goods.
He said it has no moral basis for assets to be frozen and still left in the hands of those who were complicit and are otherwise called handlers of stolen goods.
“Handlers of stolen goods are as punishable as the thieves themselves. In certain countries, the handlers even get a more severe punishment than the thieves,” he stated.
What the law says
THE Nigerian Financial Intelligence Unit (NFIU), as part of its regulatory mandates, works closely with all the core regulators of financial, other-financial institutions and designated non- financial businesses and professions.
They include: Central Bank of Nigeria (CBN), National Insurance Commission (NAICOM), Securities & Exchange Commission (SEC) and Special Control Unit against Money Laundering (SCUML).
Any transaction, particularly in the receipt of international transfer of funds and securities exceeding $10,000 or naira equivalent, must be reported to the NFIU as required by Section 2 (1) of the Money Laundering Prohibition (MLP) Act.
The NFIU has the responsibility to receive reports on currency transactions; suspicious transactions; currency declaration and other information relating to money laundering and terrorist financing activities from financial institutions and designated non-financial institutions (DNFIs).
The body is also expected to receive reports on cross-border movement of currency and monetary instruments.
The Act stipulates that:
The Suspicious Transaction Reports mentioned under Section 6 (2) of the MLPA 2011 shall be reported by financial institutions exclusively to the NFIU to aid intelligence gathering and in line with Financial Action Task Force (FATF) 2012 Recommendations 20 and 29.
Declaration of more than $10,000 or its equivalent made to the Nigerian Customs pursuant to the Foreign Exchange Act, 1995 and Section 2 (3) of the MLP Act, 2011 as amended.
The NFIU is expected to receive mandatory disclosures by financial institutions and any other individual (voluntarily) – related to single transaction, lodgment or transfer of funds in excess of N5, 000,000 or N1, 000,000 by an individual and N10, 000,000 or N5, 000,000 by a corporate entity as provided Section 10 (1) and (2), MLP Act.
It has a mandate to determine the flow of transactions and the beneficiaries for individual and corporate accounts as provided by Section 14 MLP Act, 2011 as amended.
Why CBN introduced BVN
The Central Bank of Nigeria (CBN), in collaboration with the Bankers’ Committee, introduced the Bank Verification Number (BVN) to ensure unique identity for all bank customers and other users of financial services in the country by the use of their biometrics as means of identification.
Every bank customer now has a BVN, which enables the CBN to unify and link the customer’s accounts across all the banks in the country.
The BVN has also given every bank customer a unique identity across the banking industry, since it has a centralised biometric identification system which can be used for every identification and verification at Point of Banking Operations.
The BVN is also accepted as a means of identification across all Nigerian banks; cuts down fraudulent activities on bank accounts and gives easy access to Banking operations.
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