To sanction banks for violation of financial regulations
James Emejo in Abuja
The Nigeria Financial Intelligence Unit (NFIU) has commenced investigations into revenue allocations to local government areas across the states of the federation.
The main focus of the probe is the contentious State, Joint Local Government Accounts (SJLGA), which is said to pose the biggest corruption, money laundering and security threats at the grassroots levels as well as the entire financial system.
Consequently, the anti-corruption unit said it has resolved to “uphold the full provisions of Section 162 (6) (8)of the 1999 Nigerian Constitution as amended which designated “State Joint Local Government Account into which shall be paid allocations to the local government councils of the state from the federation account and from the government of the state.”
To this end, the unit has requested all financial institutions, other relevant stakeholders, public servants and the entire citizenry to ensure full compliance with the provisions of the guidelines already submitted to financial institutions and relevant enforcement agencies including full enforcement of corresponding sanctions against violations from 1st June, 2019.
According to a statement by the Acting Chief Media Analyst for NFIU, Ahmed Dikko, the unit’s action has become necessary in order to avoid a possible isolation of the entire Nigerian financial system by other international financial systems “because of deficiencies in our anti-money laundering and counter terrorism financing implementation.”
“Therefore, it is no longer possible to allow the entire system to suffer the deliberate and expensive infractions or violations by public officials and/or private business interests.
The statement warned that going forward, all erring individuals and companies will be allowed to face direct international and local targeted sanctions, in order not to allow any negative consequences to fall on the entire country.
The NFIU specifically stressed that effective from June 1, 2019, any bank that allows any transaction from any local government account without monies first reaching a particular local government account will be sanctioned 100 per cent, both locally and internationally.
The statement further noted that a provision had also been made to the effect that there shall be no cash withdrawal from any local government for a cumulative amount exceeding N500,000 per day, adding that any other transaction must be done through valid cheques or electronic funds transfer.
Essentially, the move by NFIU is meant to check abuses and embezzlement of funds meant for the local government development, which are often seized or siphoned by state governors.
The local government councils have severally protested to relevant quarters, including the National Assembly in order devise another means where such monies could get to them directly.
The NFIU particularly drew attention to a provision establishing the joint account that, “the amount standing to the credit of local government councils of a state shall be distributed among the local government councils of that state” and not for other unspecified purposes.
“Any state government that is willing to seek any expert economic advice in the unlikely event of these guidelines constituting an inconvenience to the management of the state can work with the NFIU and /or CBN”, the statement added.
The investigation reportedly has the full backing of NFIU Boss, Modibbo Hamman-Tukur.
The NFIU also added that the complete guidelines has been released to the Governor of the Central Bank of Nigeria (CBN); the Chairman, Economic and Financial Crimes Commission (EFCC); the Chairman, Independent Corrupt Practices Commission (ICPC); and chief executive officers of all
banks and other financial institutions.