The Central Bank of Nigeria (CBN) has issued a warning to banks in Nigeria to be cautious when dealing with transactions originating from Cameroon and Vietnam. The CBN stated that there have been reports of fraudulent activities and money laundering associated with transactions from these countries.
The directive is contained in a circular released on Thursday and signed by Chibuzo Efobi, director of CBN’s financial policy and regulation department.
Efobi said the CBN’s decision to issue the warning is based on the resolutions reached at a recent plenary session of the Financial Action Task Force (FATF).
FATF is an intergovernmental policy-making body that seeks to combat money laundering and the financing of terrorism. According to FATF, jurisdictions under increased monitoring are actively working with it to address strategic deficiencies in their regimes to counter money laundering, terrorist financing, and proliferation financing.
According to TheCable, it reported that the FATF, in February, added Nigeria and South Africa to its list of jurisdictions under increased monitoring Efobi further warned banks that Iran, Myanmar, as well as North Korea, officially known as the Democratic People’s Republic of Korea (DPRK), remain on the FATF’s “black list” of high-risk jurisdictions.
“The attention of banks and other financial institutions is drawn to the outcomes of the Financial Action Task Force (FATF) Plenary conducted from June 21-23, 2023, and subsequent addition of Cameroon, Croatia and Vietnam to the list of jurisdictions under “Increased Monitoring,” the circular reads.
“Furthermore, Democratic People’s Republic of Korea, Iran and Myanmar remain on the list of high-risk jurisdictions subject to “Call for Action”. “Consequently, enhanced due diligence should be applied, and in severe cases, counter-measures may need to be implemented to safeguard the international financial system.” The apex bank also reminded financial institutions that the suspension of the Russian Federation’s membership in the FATF due to its invasion of Ukraine remains in effect.
“Fis are to remain vigilant and be alert to possible emerging risks resulting from the circumvention of measures taken to protect the international financial system,” the circular adds. “In light of these developments, Fis are directed to Note all addition to jurisdictions under Increased Monitoring” as well as high-risk jurisdictions subject to a “Call for Action” and take necessary measures to mitigate these risks effectively.”
This warning comes as part of the CBN’s efforts to combat financial crimes and ensure the integrity of the Nigerian banking system. The CBN has been implementing several measures, including the introduction of stricter KYC requirements and enhanced monitoring systems, to prevent money laundering and other illicit activities.
Banks are encouraged to remain vigilant and follow the necessary procedures to avoid being involved in fraudulent activities. The CBN will continue to collaborate with other regulatory agencies to strengthen anti-money laundering efforts and protect the Nigerian financial sector.