Nigeria’s Senate Passes Bill to Tighten Money Laundering Rules

Nigeria’s Senate has passed a bill that is aimed at improving the country’s money laundering regulations by adding the requirement of reporting suspicious transactions.

The Money Laundering Prevention and Prohibition Act 2022 obliges lenders to report all single transactions worth more than 5 million naira ($12,035) made by individuals and those involving businesses worth more than 10 million naira to the Special Control Unit Against Money Laundering.

The panel will be set up as part of the Economic and Financial Crimes Commission.

Individuals who break the new law will face jail sentences ranging between two to five years, while banks and financial institutions could face fines of up to 50 million naira. The government also added in the emailed statement that employees working at these institutions could also face prosecution.

Banks, other financial institutions, and professionals will also be legally required “to identify and assess the money laundering and terrorism financing risks that may arise in relation to the development of new products and new business practices,” it said. 

The lower House of Representatives of Nigeria will also pass the bill before it is sent to President Muhammadu Buhari for including it into the law.

Nigeria has been promoting digital payments in recent years even though most of the transactions in the country are still cash-based. 

The circulation of Nigeria’s naira notes and coins went up 4.6% last October.

Nigeria does have a new digital currency, which the Central Bank there wants to use to encourage digital payments. This would cut down on the cost of printing cash and would promote financial inclusion.

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