Egmont Group expulsion plan may ground businesses in Nigeria

Egmont Group, a global network of 152 Financial Intelligence Units (FIU), is poised to expel the Nigerian Financial Intelligence Unit (NFIU) from its fold.

If this happens, financial transactions emanating from Nigeria or having the country as its destination could be blacklisted by top economic players.

This is the latest fallout from the disagreement between the Senate and the Economic and Financial Crimes Commission (EFCC) after the lawmakers insisted that Ibrahim Magu, chairman of the commission, be relieved of his position by President Muhammadu Buhari.

The Senate last week interpreted a High Court ruling as bolstering its position on the powers to pressure the president to sack the EFCC boss.

In July 2017, Egmont Group suspended NFIU from its fold at its 24th plenary of Heads of the FIUs in Macao over alleged impropriety by EFCC in the use of information on suspicious financial transactions garnered by the financial intelligence unit for political purposes.

There were also allegations made that the EFCC used the information as a tool to blackmail political opponents in the country.

The group further explained that the NFIU was suspended because the EFCC under which the NFIU was situated, was leaking sensitive information to the media.

Some High Court judges had come down hard on the commission over what they termed media trials.

There was also an instance where a Federal High Court ordered the commission to make an open apology to one of its accused on the pages of newspapers.

The sanction by Egmont puts Nigeria on the Financial Action Task Force (FATF) blacklist.

The FATF blacklist is the shorthand description for the Financial Action Task Force list of “Non-Cooperative Countries or Territories” (NCCTs) issued since 2000.

Blacklisted countries are perceived to be non-cooperative in the global fight against money laundering and terrorism financing.

With the expulsion from Egmont and return to FATF blacklist, millions of bank depositors would be exposed to risk while trying to use their Nigerian-issued MasterCard and Visa debit/credit cards for international transactions in the coming weeks.

Nigerian gained provisional reprieve from the FATF after it set up NFIU, but domiciled under EFCC.

By Egmont Group provision, FIUs are meant to operate autonomously, operationally, having its staffing and financing as separate from the EFCC.

The country, though hadn’t met the full condition of the group, had come under intense scrutiny after protests from insiders alleged a rampant raid of NFIU’s intelligence vaults by EFCC operatives to garner intelligence sourced not only from the country but also from the group’s network of the more secured FIUs.

In 2017, when NFIU got its suspension, the Group had asked the country to tinker with its NFIU to make it more autonomous.

The impression was that a law was required to give this unit the required buffer against EFCC.

The Group specifically wanted Section 1(2)(c) of the EFCC Establishment Act which makes the EFCC the designated Financial Intelligence Unit to be amended, and create the NFIU as an autonomous unit under the EFCC.

The commission, at the time, argued that contrary to the views expressed in some quarters, the Egmont Group was not asking for the creation of a separate agency removed from the EFCC, but a greater autonomy for the NFIU in terms of having its funds and control over its staff.

The EFCC, in July, insisted that it had since begun the process, but with the plan to expel NFIU, observers believe that the Group had seen to positive development, especially in the areas of amending the relevant statute setting up the FIU, given the imbroglio between the EFCC and the Senate.