US embassy cable - 02ABUJA3314

UNCLAS ABUJA 003314 
 
SIPDIS 
 
 
SENSITIVE 
 
 
DEPT FOR INL AND AF 
. 
TREASURY FOR OFFICE OF ENFORCEMENT -- SHAUN LONERGAN 
 
 
E.O. 12958: N/A 
TAGS: EFIN, SNAR, KCRM, NI 
SUBJECT: NIGERIA: LAWS ENACTED BEFORE FATF DEADLINE 
 
REF: ABUJA 3311 AND PREVIOUS 
 
 
This is an action message; action request in para 8. 
 
 
1.(U) During a December 14 emergency session, the Nigerian 
Senate passed three pieces of money laundering legislation 
and sent the bills to the President for signature.  President 
Obasanjo signed the bills into law the same day, just prior 
to the FATF deadline of December 15 for Nigeria to pass at 
least an amendment to the 1995 Money Laundering Act. 
 
 
2.(SBU) The version of the Money Laundering Act Amendment 
approved by the Senate and signed into law restored customer 
identification and cash transaction reporting thresholds 
proposed by the Presidency and coordinated with the FATF.  On 
November 27 the Senate raised the threshold requiring 
financial institutions to identify their customers to USD 
50,000 or "its equivalent in any foreign currency (appearing 
to exclude transactions in Nigeria's currency, the Naira). 
President Obasanjo's proposed threshold of USD 5,000 or its 
equivalent in any currency was restored in the new law. 
 
 
3.(SBU) Similarly, the Senate on November 27 raised the 
threshold for requirements that financial institutions report 
cash transactions to Naira five million (equivalent to USD 
40,000) and ten million (equivalent to USD 80,000) for 
individuals and corporate entities, respectively. 
 
 
4.(SBU) The Money Laundering Act amendment also expands the 
scope of the law's coverage beyond the proceeds of drug 
trafficking to the "proceeds of a crime or an illegal act" 
and expands the scope of financial institutions covered under 
the Act to include stock brokerage firms and money changing 
establishments.  (Note: These changes were also encouraged by 
the FATF. End Note). 
 
 
5.(SBU) An amendment to the 1991 Banking and Other Financial 
Institutions Act (BOFI) was enacted to give the Central Bank 
of Nigeria expanded powers to deny licenses to financial 
institutions and to freeze suspicious accounts.  The third 
piece of legislation enacted December 14 is an entirely new 
Act -- the Economic and Financial Crimes Commission 
(Establishment) Act -- which creates a cental law enforcement 
agency to coordinate the Federal Government's efforts to 
investigate and prosecute money laundering and other 
financial crimes.  This agency will also serve as a 
clearinghouse for money laundering intelligence collected and 
shared within the country and with international partners, 
satisfying the FATF's call for a Financial Intelligence Unit 
(FIU). 
 
 
 
 
6.(SBU) According to President Obasanjo's Principal Secretary 
Stephen Oronsaye, who attended the December 14 Senate session 
to receive the bills for immediate signature by the 
President, the bills have been faxed to the Chairman of the 
FATF's Africa and Middle East Review Group (AMERG). 
 
 
7.(SBU) Comment:  The GON's remarkable enactment of this 
legislation during a holiday recess and an electoral season 
marked by extreme tension between the Legislature and 
Executive branches was made possible by a recognition among 
all concerned that Nigeria as a whole stood to lose from 
inaction.  This shows that, despite the many divisive forces 
at play in the Nigerian body politic, policy-makers have the 
ability to suppress individual interests and come together 
around issues of national importance. 
 
 
8.(SBU) Action Request:  Upon U.S. Treasury's review of the 
newly enacted legislation  -- particularly the Money 
Laundering Act Amendment -- please confirm that these reforms 
satisfy the FATF's requirements for the prevention of 
counter-measures against Nigeria. 
JETER