The Central Bank of Nigeria (CBN) has directed banks and other financial institutions to immediately freeze accounts and assets belonging to individuals and organisations accused of financing terrorism.
The directive, contained in a circular signed by Olubunmi Ayodele-Oni, followed recent sanctions imposed by the Nigeria Sanctions Committee and the United States Treasury Department’s Office of Foreign Assets Control (OFAC).
The move comes after the United States designated three individuals and six entities allegedly involved in financing the Islamic State (ISIS), including three Nigerian Bureau De Change (BDC) operators based in Lagos and Kano.
According to the CBN, all financial institutions must, without prior notice, freeze funds, assets and other economic resources owned or controlled, directly or indirectly, by the sanctioned individuals and entities.
The apex bank also instructed banks to screen their existing customers, beneficial owners and transactions against the updated sanctions list to identify any links to the designated persons.
In addition, financial institutions have been ordered to ensure that no funds, financial services or economic resources are made available, either directly or indirectly, to those listed.
Reports Required Within 48 Hours
The CBN directed banks to file Suspicious Transaction Reports (STRs) with the Nigerian Financial Intelligence Unit (NFIU) whenever a confirmed or attempted match is detected.
It further ordered institutions to submit compliance reports to the CBN within 48 hours, detailing any matched accounts, the amount of funds frozen and actions taken.
Even where no match is found, banks are required to submit “nil returns” confirming that their checks produced no results.
The regulator also urged financial institutions to strengthen monitoring systems for terrorism financing risks, particularly transactions involving rapid movement of funds, money service businesses and dealings linked to high-risk jurisdictions.
The CBN warned that failure to comply with the directive could attract penalties under the Banks and Other Financial Institutions Act (BOFIA) 2020 and other relevant laws.
It added that compliance would be monitored through off-site reviews, on-site examinations and supervisory engagements across the financial sector.
