The Central Bank of Nigeria (CBN) has directed banks and other financial institutions to immediately freeze the accounts and assets of individuals and organisations designated for alleged involvement in terrorism financing.
The directive was contained in a circular issued on Thursday and signed by the CBN’s Director of Compliance Department, Olubunmi Ayodele-Oni.
The apex bank said the action followed fresh sanctions imposed by the Nigeria Sanctions Committee and the United States Treasury Department’s Office of Foreign Assets Control (OFAC) against persons and entities allegedly linked to the financing of terrorist activities.
According to the CBN, all financial institutions are required to “immediately freeze, without prior notice,” funds, assets and other economic resources belonging to or controlled directly or indirectly by the designated individuals and organisations. The regulator also instructed banks to screen existing customers, beneficial owners and transactions against the updated sanctions list to ensure full compliance.
The move comes after US authorities recently designated three individuals and six entities accused of facilitating funding for the Islamic State (ISIS), including three Bureau de Change operators based in Lagos and Kano. The CBN stressed that no financial institution should allow funds, financial services or economic resources to be made available to the sanctioned persons or entities under any circumstance.
In addition, banks have been directed to file Suspicious Transaction Reports (STRs) with the Nigerian Financial Intelligence Unit (NFIU) where confirmed or attempted matches are detected. Financial institutions are also expected to submit detailed compliance reports to the CBN within 48 hours, outlining affected accounts, amounts frozen and measures taken, while institutions with no matches must file mandatory nil returns.
The apex bank further ordered lenders to strengthen monitoring mechanisms for signs of terrorism financing, including unusual movement of funds, transactions involving money service businesses and dealings linked to high-risk jurisdictions. It warned that failure to comply with the directive could attract regulatory sanctions under the Banks and Other Financial Institutions Act (BOFIA) 2020 and other relevant laws.
The CBN added that it would undertake off-site reviews, on-site examinations and supervisory engagements to verify adherence to the sanctions regime and ensure that financial institutions effectively implement anti-terrorism financing measures.
