Legality of EFCC Powers to Prosecute and Compel Bank Employees to Declare their Assets

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Richard Idaeho

Introduction

The Economic and Financial Crimes Commission (“EFCC” or “the Commission”) had on Tuesday, 16th March, 2021 given a directive that starting from 1st June, 2021, the Commission will be demanding for declaration of assets of employees of financial institutions, particularly, the banks. This, according to the Commission, would help to block some of the loopholes currently being exploited by unscrupulous players in the sector to undermine the Nigerian economy, through money laundering and illicit financial flows.

Against the background, the question begging for answer is whether the EFFC has the power to compel bank employees to declare their assets, or face prosecution? This will be examined below in the light of relevant laws.

A Review of the Bank Employees etc (Declaration of Asset) Act and the Economic and Financial Crimes Commission (Establishment) Act

The obligation of bank employees to declare their assets is a statutory one arising from the Bank Employees etc (Declaration of Asset) Act (BEDA Act). The BEDA Act makes it obligatory for every employee of a bank to make full disclosure of assets upon employment, and annually in subsequent years. Section 1(1) of the Act provides that “Every employee of a Bank shall, within fourteen days of the commencement of this Act, make a full disclosure of all his assets”. Subsection 2 provides “in the case of a new employee, he shall within fourteen days of assuming duty with the Bank, make a full disclosure of all his assets at the time of his assuming duty; and for the purpose of this subsection, a transfer or secondment from one Bank to another shall be treated as a new employment”.

“Bank” is defined in Section 14 of BEDA Act to include “the Central Bank of Nigeria, commercial banks, merchants banks, acceptance houses, discount houses, financial institutions or any other authorised dealer appointed under the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act”, while “employee” or “employee of a bank” is defined to includes “the Governor, the Chairman and members of the Board, Managing Director, Director, General Manager, Manager, Examiner, Inspector, Controller, Agent, Supervisor, Officer, Clerk, Cashier, Messenger, Cleaner, Driver, and any other category of workers of the Central Bank, a bank or other financial institution of whatever title or designation, whether general or peculiar to the Bank; and for the avoidance of doubt, it includes a person engaged as a part‐time, casual or temporary worker, and also any worker deployed to work in any branch or office of the Bank in or outside Nigeria”.

Section 8(1) of the BEDA Act makes it a criminal offence for any bank employee who knowingly fails to fully disclose his assets, or makes a false declaration in whole or part, or fails to answer any question contained in the appropriate form under the Act, or fails, neglects or refuses to make a declaration or furnish information as required by the provisions of the Act, and on conviction be liable to imprisonment for a term of ten years.

The BEDA Act is however, silent with respect to the authority with the powers to prosecute any bank employee who fails to comply with the provision of the Act. Notwithstanding, a careful consideration of the BEDA Act will reveal that the Act was enacted for the purpose of preventing unscrupulous financial activities by bank employees, and in this regard, a review of the Economic and Financial Crimes Commission (Establishment) Act (“EFCC Act”) will suggest that the enforcement of the BEDA Act is under the jurisdiction of the EFCC.

Section 6(b), (c), (e), and (f) of the EFCC Act enumerate the functions of the Commission to include the investigation of all financial crimes; the co-ordination and enforcement of all economic and financial crimes laws and enforcement functions conferred on any other person or authority; the adoption of measures to eradicate the commission of economic and financial crimes; and the adoption of measures which include coordinated preventive and regulatory actions, introduction and maintenance of investigative and control techniques on the prevention of economic and financial related crimes.

From the foregoing, the EFCC is, by virtue of Section 6(c) and (f) of the EFCC Act, empowered to co-ordinate and enforce all economic and financial crimes laws and exercise enforcement functions conferred on any other person or authority by virtue of any such laws. In addition, Section 7(2) of the EFCC Act expressly makes the EFCC the coordinating agency for the enforcement of specific laws and “(f) any other law or regulation relating to economic and financial crimes, including the Criminal Code and Penal Code.”

The Powers of the EFCC

The powers of the EFCC and the scope of who the Commission can investigate was emphasised in FCDA Staff Multi-Purpose (Coop) Society & Ors v Samchi & Anor, thus: “…it is important not to have any illusions about the powers and functions of the EFCC. For the avoidance of doubt Section 7(1) (a) and (b) of the EFCC Act, provides that: ‘The Commission has powers to – (a) cause investigations to be conducted as to whether any person, corporate body or organisation has committed an offence under this act or other law relating to Economic and Financial Crimes Commission: (b) cause investigations to be conducted into properties of any person if it appears to the Commission that the person’s lifestyle and extent of the properties are not justified by his source of income.’ Clearly the powers of the EFCC to investigate, and indeed, prosecute crimes is not restricted to government agencies, public officers or civil servants, as it appears to be suggested, it extends to corporate bodies and organisations, where they offend the law….”

Furthermore, in Ajoku v EFCC & Ors, the Court of Appeal, while expounding on the powers of the EFCC, held that “the Commission is the designated Financial Intelligence Unit (FIU) in Nigeria, which is charged with the responsibility of coordinating the various institutions involved in the fight against money laundering and enforcement of all laws dealing with economic and financial crimes in Nigeria.”

In view of the above, the EFCC is empowered by law to prosecute any person who has committed financial or economic crimes. Thus, the action of the Commission was predicated on the provisions of the BEDA Act, which mandates all bank employees to declare their assets or face prosecution. Section 7 of the BEDA Act makes it “an offence for an employee of a Bank to own assets in excess of his legitimate, known and provable income and assets”, and where found guilty shall on conviction be liable to imprisonment for ten years, and shall, in addition, forfeit the assets or its equivalent in money which are in excess of his legitimate, known and provable income and assets, to the Federal Government.

Can the EFCC Enforce the Provisions of BEDA Act?

A community reading of the EFCC Act, as well as judicial authorities empower the Commission to enforce the provisions of any other law or regulations relating to economic and financial crimes. As part of its functions, the Commission has the vires to adopt measures geared towards a coordinated preventive and regulatory actions, introduction and maintenance of investigative and control techniques on the prevention of economic and financial related crimes.

In view of the above, it can be said that the directive of the EFCC is merely a reiteration of an already existing provision of the law, which Bank employees are expected to comply with. However, whether the EFCC has the jurisdiction to enforce the provisions of the BEDA Act, is a question that now begs for answers. It will appear clear that the EFCC has not been statutorily empowered by the BEDA Act to enforce its provisions, and the EFCC Act did not expressly include the BEDA Act amongst the list of Acts for which the Commission will act as the coordinating and enforcement authority.

The EFCC is a creation of statute, and every exercise of power by it must be traceable to an enabling law. It would therefore, be arguable whether the EFCC has the statutory jurisdiction to enforce the provisions of BEDA Act. Thus, on the one hand, to the extent that jurisdiction is statutory, it is argued that until the President makes a regulation with regards to the effective implementation of the BEDA Act as donated by virtue of Sections 12 and 13 of the Act, or the National Assembly takes appropriate legislative measures to address the issue of the agency with power to enforce the BEDA Act, the jurisdiction of the EFCC to implement the BEDA Act would remain a controversy.

However, on the other hand, the sweeping functions and powers of the EFCC under Sections 6 and 7 of the EFCC Act which extends both to the public and private sectors as relate to economic and financial crimes are capable of clothing the Commission with the powers to enforce the BEDA Act. It could be axiomatically argued that the Commission has the power to apply and enforce the provisions of BEDA Act being a financial or economic law, and as such would be considered as falling within Section 7(2)(f) thus forming part of “any other law or regulation relating to economic and financial crimes.” Hence, the Commission would equally be the co-ordination agency for the BEDA Act. The decisions of the court above, would seem to have provided a judicial support for this position.

Conclusion

The EFCC is statutorily empowered to enforce the provisions of any law or regulations relating to economic and financial crimes, and also acts as coordinating agency for specifically enumerated Acts, as well as all other laws relating to economic and financial crimes.

The BEDA Act has though not been specifically mentioned as falling within the coordinating purview of the EFCC, a review of the general powers of the EFCC however, will suggest that the Commission has the jurisdiction to administer and implement the provisions of the BEDA Act as forming part of the laws relating to economic and financial crimes.

Richard Idaeho Legal Practitioner, Lagos