Nigeria’s Suspension by Egmont Group Forces Senate to Make NFIU Autonomous

  • Suspension, threat to country’s financial system
  • Senate passes Whistle Blower Protection Bill

Damilola Oyedele in Abuja

In a bid to avert the expulsion of Nigeria from the Egmont Group, a network of 152 financial intelligence units (FIUs) across the world, the Senate Wednesday began processes that would grant legal, operational and financial autonomy to the Nigeria Financial Intelligence Unit (NFIU), leading to its decoupling from the Economic and Financial Crimes Commission (EFCC).

This is as it accused the Acting Chairman of the EFCC, Mr. Ibrahim Magu, of contributing to Nigeria’s recent suspension from the group by his interference in the operations and staffing of the NFIU, despite claims that the unit was autonomous.

Magu’s meddlesomeness, the Senate said, has led to the exit of many competent hands from the NFIU.

The Senate therefore directed its Committee on Anti-Corruption and Financial Crimes to prepare and submit a draft bill for the enactment of a law that would create a substantive and autonomous NFIU and make it autonomous with powers for the employment, reward, training, promotion and discipline of its workforce independently.

The committee is expected to submit the draft bill in four weeks.
The Egmont Group is the highest inter-governmental association of intelligence agencies in the world with membership by 152 countries.

It provides a platform for sharing criminal intelligence and financial information bordering on money laundering, terrorism financing, proliferation of arms, corruption, financial crimes, economic crimes and similar offences geared towards the support of local and international investigations, prosecutions and assets recovery.

Nigeria was fully admitted into the coveted body in 2007, after operational admittance in 2005, in what was considered one of the biggest achievements of the Olusegun Obasanjo administration.

Some of the agencies that benefit from the activities of the group include the Central Bank of Nigeria (CBN), Nigerian Customs Service, Independent Corrupt Practices and Related Offences Commission (ICPC), the EFCC, Nigeria Immigration Service (NIS), Federal Inland Revenue Service (FIRS), and the Securities and Exchange Commission (SEC) among other relevant governmental agencies.

The country’s membership paved the path for the removal of Nigerian banks from the blacklist of international finance.

The blacklisting had prevented the banks from engaging in correspondent banking with foreign institutions and also denied Nigerians access to foreign credit cards.

The NFIU, which represents Nigeria in the Egmont Group, was suspended at its July 2017 meeting in China, following Nigeria’s failure to grant operational autonomy to the financial intelligence unit, a situation which the group has objected to for years.

Nigeria was also accused of divulging confidential information and constant leakage of sensitive intelligence to the Nigerian media, contrary to global best practices the country signed up for.

The group also issued a December 2017 ultimatum to Nigeria to address the issues that led to the suspension or be expelled, which will attract international sanctions against Nigeria’s financial system.

The Senate accused the EFCC of aggressively resisting all efforts to grant the requisite autonomy to the NFIU to allow it meet its mandate, technically and logistically.

The senators further noted that the Ministries of Justice, Finance and Interior did not complement the efforts of its Committee on Anti-Corruption to avert the suspension, despite pleas and correspondences for action.

The position of the Senate was sequel to a motion sponsored by Senator Chukwuka Utazi (Enugu North), who highlighted the implications of the suspension of Nigeria from the Egmont Group.

“Nigeria relies on the Egmont Group for assistance in the investigation of the crimes listed above (corruption, money laundering, terrorism financing, financial and economic crimes), as all bank accounts and other assets of suspects are made available to the country wherever they are located in the world.

“Be informed that one of the immediate effects of Nigeria’s suspension from the group is that the Egmont Secure Web, (ESW) is currently shutdown against Nigeria.

“The implication is that Nigeria can no longer exchange sensitive information with other member countries in order to carry out our investigative and regulatory responsibilities as they affect local and international investigations.

“We observe that apart from the suspension of Nigeria this July, the group has given Nigeria up to December 2017 to address the issues raised in the suspension or be expelled, which will attract international sanctions against Nigeria’s financial system.

“Nigeria can ill-afford to be blacklisted as the implications are dire, not only to our aspiration for membership of the Financial Action Task Force (FATF) into which so much energy, time and resources have been invested but the country will also be listed in the G8 list of Non-Cooperating Countries and Territories (NCCT).

“Be informed that if expelled, the United Nations Convention Against Corruption (UNCAC) Implementation Reviewing Group will be served notice against Nigeria, and most countries, including the United States, the UK, Germany, Switzerland, etc., would alert their financial institutions and services through the issuance of advisories such as the Financial Criminal Enforcement Network Advisory and Foreign Assets and Cash Directive, to warn them to apply extra care and diligence in transacting with Nigeria and Nigerians.

“The huge political and economic implications of such actions are better imagined. An expulsion might also, under certain conditions, attract the imposition of financial transaction limits, including the withdrawal by certain countries of scholarships to students of Nigerian origin.

“Concerned that these sanctions will necessitate that Nigeria will undergo the process of fresh application which takes years to accomplish, in addition to subjecting Nigeria’s financial standards to a total and strict review by international bodies such as the World Bank and the IMF, and assets recovery or repatriation to Nigeria can be slowed down or even stopped, and all painstaking efforts for the full membership of FAFT would be in vain if this suspension is not quickly reversed,” Utazi warned.

Contributing to the debate, Senator Dino Melaye (Kogi West) added that the suspension would negatively affect Nigeria’s ratings by global organisations such as Transparency International.

“There is serious interference with the activities and operations of the NFIU,” Melaye stated.
“I want to ask this Senate, as a matter of urgent national importance, to immediately start the process of enacting this law. The disease that is bedeviling EFCC is a communicable one, so that it will not affect the NFIU,” the senator added.

Deputy Senate President Ike Ekweremadu recalled that in the last Senate, there was a huge debate on where to domicile the NFIU, particularly because it was very influential and had access to international funding.
“The NFIU used to be a department in the EFCC and what they do is to gather financial intelligence about bank transactions.

“Because it gets international funding and it is very influential, there was a huge debate on where to domicile it either in the Central Bank of Nigeria or Office of the Attorney General of the Federation (OAGF) or Office of the National Security Adviser (ONSA).

“Eventually, the last Attorney General of the Federation (Mohammmed Adoke), because EFCC reports to his office, was able to domicile it with the EFCC.

“The problem now, which the Egmont Group is complaining about, is that all the staff of NFIU are from the EFCC and they believe that it is not right; that it is supposed to be independent,” Ekweremadu noted.

The Deputy Senate President suggested that an urgent meeting of stakeholders from the CBN, OAGF, ICPC, EFCC, ONSA and the Department of State Services (DSS) be convened.

“Let them sit down and look at the best practices. Where are they (the units) domiciled in other jurisdictions? Then we can now come back and have an informed opinion on what to do,” he said.

Presiding, Senate President Bukola Saraki said the suspension was a setback for Nigeria’s anti-corruption fight.
“As such, we must move swiftly because we cannot afford to be cut off from the Egmont Group. We must move swiftly and ensure that this suspension is lifted and one of the things we need to do is to ensure that we pass this bill as soon as possible and give independence to NFIU,” Saraki said.

“Other activities that must have led to this must be stopped. The Committee on Anti-corruption will carry out its oversight functions to ensure that the sooner we get the suspension lifted, the better for our image and the fight against corruption,” he added.

Politics and Infighting over NFIU

According to online news site, The Cable, Nigeria started getting into trouble with the Egmont Group in 2008 when Farida Waziri was appointed EFCC chairman by President Umaru Musa Yar’Adua.

Because of the circumstances surrounding the removal of Nuhu Ribadu as EFCC chairman and the perceived romance of the Yar’Adua government with corrupt politicians, Nigeria was isolated within the group.

NFIU’s access to sensitive financial intelligence on the Egmont Group portal was curtailed — it was believed that information was being shared with those under investigation by the EFCC.

The group demanded that Nigeria should make the NFIU independent of government control.

Recommendation 29 of the international standards set by the FATF says the FIU must be an independent institution free of interference from anybody or institution.

To comply with the Egmont requirement, President Goodluck Jonathan, on assuming power in 2010, set up a presidential committee on FATF.

He also appointed Ibrahim Lamorde as the new chairman of the EFCC, and the NFIU access was restored by the Egmont Group.

In 2013, Jonathan sent a bill to the National Assembly to make NFIU autonomous and both chambers passed the bill, but things fell apart when it came to harmonisation.

An official of the EFCC, who asked not to be named, said the bill did not see the light of day because of “selfish power play”.

“The original proposal was that the NFIU would report to the Office of the Attorney-General in rendering accounts,” he said.

“However, a former head of service who was eyeing the position of the chairman of the central bank board went and lobbied the lawmakers to put the unit under CBN, insisting that NFIU is a financial matter.

“To make matters worse, the EFCC wanted to be in control of NFIU. This too frustrated the legislation. At the end of it all, the law was neither harmonised nor passed,” he revealed.

Whistle Blower Bill Passed

Meanwhile, the Senate Wednesday also passed the Whistle Blower Protection Bill intended to protect persons who make disclosures of improper conduct by public officers and public bodies.

If signed into law, the bill provides that false whistle blowers would be liable to a minimum of five years imprisonment or a fine of N10 million.

The bill also adopted the federal government policy to reward whistle blowers with five per cent of the recovered loot, which their disclosure led to its recovery.

Known as “An Act to Protect Persons Making Disclosures for the Public Interest and Others from Reprisals, to Provide for the Matters Disclosed to be Properly Investigated and Dealt with and for Other Purposes Related Therewith”, the bill was sponsored by Senator Biodun Olujimi (Ekiti South).

Under the new bill, a person who makes a disclosure shall not be victimised by his or her employers or by fellow employees.

The whistle blower would be considered as having been subjected to victimisation if because of making a disclosure, he/she is dismissed, suspended, declared redundant, denied promotion, transferred against his or her will, harassed and intimidated.

The person has the right to institute legal action if he/she suffers as a result of his/her whistle blowing.
Contained in the report of its Committee on Judiciary, Human Rights and Legal Matters, the bill also outlines the processes that must be undertaken after a person has made a disclosure.

It also provides for the establishment of a public interest disclosure reward fund to serve as incentive to potential whistle blowers.

Speaking on the passage of the bill, Saraki described it as a promise kept.
“Today, we have passed a landmark piece of legislation to fight corruption and protect patriotic Nigerians who are fighting corruption.

“This bill will protect the lives of those who risk themselves to expose corrupt practices in Nigeria,” Saraki said.
With the passage of this bill, the Senate has concluded work on the three anti-corruption bills before it.
Last May, it passed the Mutual Assistance in Criminal Matters Bill, while in June it passed the Witness Protection Bill.

The Bill to Establish Special Anti-Corruption Courts has been sent to the Constitution Amendment Committee, while the Proceeds of Crime Bill has been sent to the Senate Joint Committee on Anti-Corruption and Judiciary.