In the fight against financial crimes, particularly money laundering, Nigeria has taken a significant step with the enactment of the Money Laundering (Prevention and Prohibition) Act, 2022. This Law aims to fortify the legal and institutional framework for combating money laundering and related offenses within the country. A closer examination of Sections 1 to 3 of this Act sheds light on preventing and prosecuting illicit financial activities.
Section 1 outlines the objectives of the Act, which is to provide an effective legal framework for the prevention, detection, and prosecution of money laundering offenses. Notably, the Act establishes the Special Control Unit Against Money Laundering under the Economic and Financial Crimes Commission (EFCC) to oversee the implementation of anti-money laundering provisions, particularly concerning designated non-financial businesses and professions. By strengthening the existing system for combating money laundering, the Act seeks to broaden the scope of offenses and impose appropriate penalties, thereby creating a deterrent for potential wrongdoers.
Section 2 introduces limitations on cash transactions, a common avenue for laundering illicit funds. The provision stipulates that no individual or corporate entity shall make or accept cash payments exceeding specified thresholds, except through financial institutions. This measure aims to curb the anonymity associated with large cash transactions and discourage the use of cash for illicit purposes. Additionally, it prohibits individuals from conducting multiple transactions with the intent to evade reporting requirements, thereby closing loopholes exploited by money launderers.
Furthermore, Section 3 addresses the international dimension of money laundering by imposing reporting obligations on transfers of funds or securities exceeding a certain threshold. Such transfers to or from foreign countries must be promptly reported to designated authorities, including the Central Bank of Nigeria and the Securities and Exchange Commission. Similarly, individuals transporting cash or negotiable instruments above the prescribed limit are required to declare such items to the Nigerian Customs Service. This provision enhances transparency in cross-border financial transactions and facilitates the detection of suspicious activities.
Importantly, the Act imposes severe penalties for non-compliance or false declarations, emphasizing the seriousness with which Nigeria views the fight against money laundering. Offenders face the risk of forfeiting undeclared funds or negotiable instruments, as well as imprisonment for a minimum term of two years. Such stringent measures send a clear message that illicit financial activities will not be tolerated, and perpetrators will be held accountable under this Act.
Sections 1 to 3 of the Money Laundering (Prevention and Prohibition) Act, 2022 represent a significant step forward in Nigeria’s efforts to combat money laundering and related offences. By establishing comprehensive legal provisions, enhancing reporting requirements, and imposing strict penalties, the Act strengthens the country’s anti-money laundering regime and promotes a more transparent and accountable financial system. However, effective enforcement and cooperation among relevant stakeholders will be essential to realizing the Act’s objectives and safeguarding Nigeria’s financial integrity.
