Money Laundering Act: Banks, Businesses To Pay N1m Daily For Suspicious Transactions

The Federal government of Nigeria has enforced a fine of one million naira on any financial institution or non-financial institution that fails to report suspicious transactions.

This is in accordance to the Money Laundering (Prevention and Prohibition) Bill, 2022, which the President, Major General Muhammadu Buhari (retd.), recently passed into law.

In Section 7 of the Act, which was titled ‘Suspicious transaction reporting’, it was stated that a suspicious transaction can be one with unjustifiable or unreasonable frequency.

It is also a transaction of unusual or unjustified complexity appears to have no economic justification or lawful objective or is inconsistent with the known transaction pattern of the account or business relationship.

The Act added that a suspicious transaction could also be any transaction, which in the opinion of the financial institution or non-financial business and profession, involves the proceeds of criminal activity, unlawful act, money laundering or terrorist financing.

Section 7(10) of the Act read in part “A financial institution or designated non-financial business and profession which fails to comply with the provisions of subsections (1) and (2) of this section commits an offence and is liable on conviction to a fine of N1m for each day during which the offence continues.”

The Money Laundering (Prevention and Prohibition) Act has also established a Special Control Unit Against Money Laundering under the Economic and Financial Crimes Commission, which is to monitor financial transactions within and outside Nigeria.