Cablegate: Nigeria: Economic and Financial Crimes Act Passed

Published: Tue 24 Feb 2004 05:01 AM
This record is a partial extract of the original cable. The full text of the original cable is not available.
E.O. 12958: N/A
1. (U) Summary: Nigeria took another step forward on the
anti-corruption front, and hoped to gain its removal from the
FATF list of Noncooperating Countries and Territories (NCCT),
when President Obasanjo signed into law the Economic and
Financial Crimes Act and a Money Laundering Act on February
23. President Obasanjo's team overcame last minute internal
procedural questions to gain passage in the House of
Representatives on February 19, and forwarded the signed
legislation's texts to FATF February 23 for its February 24
meeting. End Summary.
2. (U) Nigeria's House of Representatives on February 19
passed the Economic and Financial Crimes Act (EFCA) and a
Money Laundering Act that aim to meet FATF standards to
remove Nigeria from the NCCT list. The Senate had passed a
similar bill the week before. The National Assembly sent the
finished bill to President Obasanjo February 23, who signed
and forwarded it electronically to FATF, according to
Economic and Financial Crimes Commission (EFCC) Director
General Emmanuel Akomaye. FATF is due to begin meeting on
February 24 and the GON hopes that session will remove
Nigerian from the NCCT.
3. (U) Since Akomaye met January 13 in Rome with FATF
officials, he has been consistently confident that FATF would
approve of the two laws. At the Rome meeting, FATF officials
reviewed an initial draft of the laws sent to Obasanjo for
signature on January 5. Akomaye said he received assurances
from FATF officials at that time that the laws fit their
expectations. He said FATF would have been "more
comfortable" with lower transaction thresholds and lower
penalties but they still fit within acceptable parameters.
The EFCA, as sent to Obasanjo, sets a 1 million naira
threshold for reporting individuals' transactions and a 3
million naira limit for corporations. It also stipulates a
100,000 naira penalty for false statements during an
4. (U) Based on these FATF comments, Obasanjo earlier this
month sent the laws back to the National Assembly for
changes. The House of Representatives denied his request to
lower the thresholds and penalties, but did meet his request
to remove a clause that limited appeals, a section Nigeria's
Attorney General had found unconstitutional. The clause was
meant to have sped up cases by reducing the time-consuming
immediate appeal of all technical and procedural issues. The
National Assembly also removed the Attorney General's
authority to direct the operations of the EFCC, arguing that
the EFCC would lose accountability to the National Assembly
and some of its anti-corruption punch if it was micromanaged
by the Executive.
5. (U) Comment: The Embassy has long advocated, publicly and
privately, for a strong Economic and Financial Crimes Act.
The money laundering-related reporting levels and penalties
are not optimum for FATF approval, but they may be good
enough and the legislation undoubtedly gives the EFCC tools
to attack corruption overall. Akomaye was particularly
pleased with the law's legislative mandate for an EFCC
Financial Investigation Unit (FIU). Senator Farouk Bello,
chair of the Senate Committee on Banking and former executive
director of Guaranty Trust Bank, said the law would be good
on corruption, but added that the National Assembly would be
looking at further tightening of the country's financial laws
and regulations governing checks and other financial
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