FAFT-R8 REGIONAL WORKSHOP REPORT

The Nigeria Network of Non- Governmental Organizations (NNNGO) in collaboration with the Special Control Unit Against Money Laundering (SCUML) organised two regional workshops themed, Effective Implementation AML/CFT Requirements in the NPO Sector in Nigeria.

 

The first of the workshops was held in Lagos; Vantage Hub: Mosesola House on 19th February 2018 and gathered 67 participants from across the southern region. The second workshop, organised at Den is Hotel, Abuja on 26th February, 2018 was attended by 68 participants from the northern region.

 

In attendance were the Directors of NFIU, Mr Francis Usani and SCUML, Mr Bamanga Bello, as well as officials from the Economic and Financial Crimes Commission (EFCC), SCUML, the Nigerian Financial Intelligence Unit (NFIU) and various Civil Society Organizations (CSOs).

REPORT OF 2018 SECTORWIDE CONFERENCE ON FATF-R8

On March 28, 2018, over 200 participants from across the country attended the sector-wide conference themed Implementation of AML/CFT Standards for the Non-Profit Organisations, (NPOs) Sector in Nigeria. Organised by the Nigeria Network of NGOs, in collaboration with Special Control Unit on Money Laundering, the conference focused on the need for a reform of the legal framework on AML/CFT measures, strengthening of the criminal justice system and inter-agency cooperation, funding and capacity strengthening of regulatory agencies in ways that ensures ease of regulatory compliance by all sectors.

 

At the end of the conference, participants affirmed their commitment towards working to address critical issues faced by NPOs in relation to compliance with the law and called on SCUML to continue its good work of engaging and partnering with stakeholders in implementing a robust AML/CFT for the country

NATIONAL RISK ASSESSMENT WITHIN THIRD SECTOR

Written by Chidinma Okpara: Project Officer, Regulatory Engagement, NNNGO

 

Risk assessment; a process of evaluating potential risks, is often tailored round a projected activity as a way to define an estimate of risk related to the known threat. Over the years, Nigeria, like many African countries, has become a significant center for financial crime. This is essentially due to lack of proper checks and balances within the socio-economic purview, weak laws, weaker implementations of the laws already on ground and general lack of attention being paid to the movement of money especially within the third sector; terrorist organizations and corrupt officials therefore take advantage of the situation to launder money through not-for profit organizations and for the most part, get away with it.

The requirement to perform a National Risk Assessment stemmed from the 40 Recommendations on International Standards on Combating Money Laundering and the Financing of Terrorism and Proliferation handed down by the Financial Action Task Force’s (FATF), issued in 2012 and subsequently revised in 2016. The FATF is an intergovernmental body established in 1989It is the global body that sets the standards for combating money laundering and terrorist financing as well as other related threats to the integrity of the international financial system.

 

The National Risk Assessment began in the wake of the revision of the FATF recommendations which was done in 2012, recommending that countries identify, assess and understand the level of risks their countries face in terms of money laundering and terrorist financing. It mandated the need for specific actions to be taken in order to assess and ultimately mitigate these risks in their locales. Before it was officially reviewed and amended in 2016, the FATF Recommendation characterized Non-Governmental Organizations (NGOs) as being particularly vulnerable to terrorists abuse and this impacted the operation of civil society organizations greatly as laws which restricted the free operations of NGOs were then implemented. The revision however helped in gauging the effectiveness of the stringent laws, bringing to light the areas where implementation could be enhanced to mitigate the high risk of terrorist abuse within the sector.

 

Since inception, assessments have been done via mutual evaluations that are conducted with the country and representatives of the FATF or regional standard setter. It is to ensure that measures which are intended to be put in place to combat and ultimately mitigate the of risks of money laundering and terrorist financing within a country, sector or an organization are proportionate with the level of risks identified; anywhere there is movement of money: Financially-Based Organizations (FBO) as well as Designated Non-Financial Institutions (DNFI) which received sponsorship from various sources; NPOs are a part of , there is a perceived threat and the aim is to prevent criminals from using the financial system to move ill-gotten funds.

 

The Nigerian Financial Intelligence Unit (NFIU) has established a unit responsible for conducting thematic strategic analysis with a view to identifying money laundering and terrorism financing trends and typologies prevalent in the country. In this capacity, the NFIU relies mainly on the intelligence generated by itself and has not systemically benefited from other information in particular cases investigated by law enforcement agencies which were not triggered by NFIU. To date the NFIU has published one typology report on terrorist financing.

 

Organizations would demonstrate that the issues which predispose them to risks or amplify their level of vulnerability are taken into consideration; adequate measures to strengthen their structures and mitigate these risks are thought through and implemented. It is important to note however that even in all of these, risk is a dynamic and amorphous concept as it is inherently difficult to describe or measure in quantifiable terms; areas which were not initially considered to be vulnerable could pop up as the weak link if the mitigated measures are not carried out to safeguard the organization or sector as a whole therefore a risk assessment will involve making judgments about these perceived issues to achieve it intended goal.

UNDERSTANDING THE ROLE OF GIABA

Written by Chidinma Okpara: Project Officer, and Oyindamola Aramide: Communications Officer, Regulatory Engagement, NNNGO.

 

Thoughts and opinions expressed are that of the authors and does not necessarily reflect the views of the Nigeria Network of NGOs

 

The Inter-Governmental Action Group against Money Laundering in West Africa, (GIABA) is responsible for strengthening the capacity of ECOWAS member states towards the prevention and control of money laundering and terrorist financing in the region.

Officially inaugurated in year 2000, GIABA operates as one of the eight FATF style regional bodies concerned with ensuring that member states of ECOWAS comply with international AML/CFT standards as well as granting Observer Status to African, non-African States and Inter-Governmental Organizations which have applied for observer status and support its objectives and actions.

 

The creation of GIABA is a major response and contribution of the ECOWAS to the fight against money laundering. GIABA consists of 16 countries: Benin, Burkina Faso, Cabo Verde, Côte d’Ivoire, The Gambia, Ghana, Guinea, Guinea-Bissau, Liberia, Mali, Niger, Nigeria, Sao Tome and Principe, Senegal, Sierra Leone, and Togo.

 

GIABA’s core functions includes: Institutional Development, compliance monitoring, technical support to member states, Regional and International Cooperation, partnership, Typologies and other Research. This helps to determine the techniques, methods, extent, pattern, trends, location and impact of Money Laundering and Terrorist financing on Member States. The conduct of Technical Assistance Needs Assessment (TANA) on member States was aimed at determining specific targets for intervention with a view to making maximum impact in strengthening the regional AML/CFT framework.

 

This anti-money laundering agency operates through four main organs: An Ad Hoc Ministerial Committee consisting of three ministers responsible for Finance, Justice and Interior/ Security of each Member State; The Secretariat, which is located in Dakar, Republic of Senegal; the Technical Commission, which consists of experts drawn from the above-mentioned ministries of member States and; a network of national correspondents.

 

In carrying out its duties, GIABA conducts Mutual Evaluations of Member States in accordance with FATF standards and also in compliance with its enabling Statutes. The Evaluations are based on the FATF Forty Recommendations (2003) and the Nine Special Recommendations on Terrorist Financing (2001), using the AML/CFT Methodology 2004.

 

Member States of GIABA agree to subject themselves to a mutual assessment process in conformity with international standards for preventing money laundering and financing of terrorism as contained in Articles 12 to 14 of the GIABA Statute. The scope of the Evaluation is to assess whether the necessary laws, regulations or other measures required under the essential criteria are in force and effect, that there has been a full and proper implementation of all the necessary measures, and that the AML/CFT system as implemented is effective.

 

The evaluated country is rated depending on the efficacy of measures put in place to detect, prevent or sanction cases of money laundering and terrorist financing. Ratings range from compliant, largely compliant, partially compliant, to non-compliant. A report is issued after completion of the mutual evaluation. It is then discussed and adopted at GIABA Plenary. Once the report is adopted by the Plenary, it will be published on GIABA website unless the country raises objection to the publication of the report. In such a situation, the Secretariat would publish a note to indicate that the country has chosen not to publish its report. The mutual evaluation onsite visits are based on the calendar approved from time to time by the GIABA Ad Hoc Ministerial Committee.

 

It is safe to say that going by its method of evaluation, implementation of laws and regulations and the adoption of FATF’s way of doing things, GIABA has adopted the FATF procedure in the evaluation of Member States.

The Nigeria Network of NGOs (NNNGO) is the first generic membership body for civil society organisations in Nigeria that facilitates effective advocacy on issues of poverty and other developmental issues. 

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