Money laundering act: FG to fine institutions failing to disclose suspicious transactions 1 million per day

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By Ismail Auwal

Nigerian Government has imposed a N1 million fine per day on any financial institution, non-financial business, or profession that fails to report any suspicious transaction.

The fine is contained in the Money Laundering (Prevention and Prohibition) Bill, 2022, assented to by President Muhammadu Buhari.

Section 7 of the Act, titled “Suspicious transaction reporting,” stated that a suspicious transaction could be any transaction with an unjustifiable or unreasonable frequency.

It also includes any transaction surrounded by unusual or unjustified complexity, appears to have no economic justification or legal objective, or is inconsistent with the account’s or business relationship’s known transaction pattern.

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.”

It added that the directors, officers and employees of financial institutions and designated non-financial businesses and professions who implement their duties under this Act in good faith are not liable to any civil or criminal liability or have any criminal or civil proceedings brought against them by their customers.

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