Nigeria: Financial Industry Calls for Stringent Measures Against Financial Criminals

A consensus among stakeholders in the financial sector has emerged, leading to a set of measures aimed at blacklisting criminals involved in financial misconduct.

This collective agreement was the result of the Information Security Society of Africa-Nigeria’s cybersecurity roundtable held in Lagos. The event, themed “Re-thinking corporate governance rules on money transfers,” brought together a diverse group of participants, including representatives from Deposit Money Banks, FinTechs, the Economic and Financial Crimes Commission, FBI, Central Bank of Nigeria, Nigeria Inter-Bank Settlement System Plc, Internet Service Providers (Huawei), tech companies, cybersecurity firms, and legal practitioners.

One of the key points in the communique issued at the conclusion of the event was, “The committee agreed on the need to create effective blacklists of criminals in the financial sector. Once they have committed any infraction anywhere within the industry, they should be blacklisted industry-wide.”

In addition to advocating for inclusiveness in financial regulations, the communique emphasized that “CBN should not shut out the crypto operators and dealers. Many of the proceeds of fraud get converted to cryptocurrency, and the funds trail thus disappears into that space. Greater regulatory attention and scrutiny is required to ensure cryptocurrency does not become a hiding place for proceeds of crime.”

The stakeholders also proposed incentives for whistleblowers. They suggested, “If a person or an organization reports or prevents a fraud, CBN should reward them by getting the beneficiary of that action – account holder or bank – to pay the whistleblower a token. This would encourage critical and beneficial information flow. Conversely, there should be sanctions for deliberately giving wrong information.”

Dr. David Isiavwe, the President of ISSAN, emphasized the continuous growth of digital payments. He stated, “This trend is expected to be sustained in the nearest foreseeable future. Fintechs, therefore, have a critical role to play in the future of financial services. The more you innovate, the more you need to automate the attendant controls and ensure that they are strictly monitored.”