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Nigeria’s Securities and Exchange Commission (SEC) has issued a sweeping directive ordering the immediate freezing of assets linked to 13 entities recently flagged for alleged terrorism financing activities within the country’s financial system.
The enforcement action follows the designation of 10 individuals and three corporate entities on the Nigeria Sanctions List by the Nigeria Sanctions Committee. In a compliance directive circulated to Capital Market Operators (CMOs), the Commission emphasized that the measure is mandatory and effective immediately across all market participants.
Anchored on the provisions of the Terrorism (Prevention and Prohibition) Act, 2022, the directive mandates the instant freezing of all funds, assets, and economic resources associated with the listed individuals and organisations—without prior notification. This underscores Nigeria’s strengthened regulatory compliance framework in combating illicit financial flows and enhancing financial crime prevention.
According to the SEC, all CMOs and relevant stakeholders are required to comply with Section 49 of the Act, which authorises the enforcement of asset freezes, travel bans, and arms embargoes on sanctioned entities. The Commission further outlined strict compliance management obligations, including the immediate identification and freezing of affected accounts, as well as mandatory reporting of both frozen assets and attempted transactions to the Nigeria Sanctions Committee Secretariat.
This directive reinforces the importance of robust compliance monitoring tools, AML software, and real-time regulatory reporting systems within Nigeria’s capital market ecosystem.
Details surrounding the sanctions indicate that several of the listed individuals were previously convicted by the Abu Dhabi Federal Court of Appeal in April 2019 for terrorism financing offences linked to Boko Haram. The cases involved the movement of funds from Dubai to Nigeria to support terrorist activities, with penalties ranging from 10-year prison terms to life imprisonment.
The SEC noted that the use of corporate entities in facilitating such financial flows highlights the growing complexity of illicit networks and the urgent need for enhanced risk assessment, fraud detection, and Know Your Customer (KYC)processes across financial institutions and non-financial businesses.
Importantly, the Commission clarified that the asset-freezing mechanism is preventive rather than punitive, aimed at disrupting financial channels that support terrorism before funds can be deployed. This aligns with global best practices in anti-money laundering (AML) and counter-terrorism financing (CFT), as well as evolving RegTech solutions designed to strengthen proactive enforcement.
The directive also extends beyond traditional financial institutions to include Designated Non-Financial Businesses and Professions (DNFBPs), reflecting a broader and more integrated regulatory enforcement strategy across Nigeria’s financial ecosystem.
The SEC reiterated its zero-tolerance stance on violations of AML/CFT regulations, stressing the need for continuous transaction monitoring, rapid name screening, and efficient asset tracing. Market operators are expected to leverage advanced compliance technology, compliance analytics, and automated compliance workflows to meet these obligations.
Failure to comply with the directive, the Commission warned, could result in severe consequences, including regulatory sanctions, criminal liability, and significant reputational damage. This further highlights the critical role of compliance audits, internal controls, and regulatory risk management in safeguarding institutional integrity.
As Nigeria intensifies its fight against financial crime, the directive signals a decisive move towards strengthening regulatory intelligence, improving compliance automation, and advancing the adoption of RegTech innovations to ensure a resilient and transparent capital market.
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