CAC flags 248 fake companies, accuses Banks of aiding compliance breaches
By Matthew Denis
The Registrar-General of the Corporate Affairs Commission (CAC), Hussaini Magaji, has revealed that the commission has reported 248 fake companies to the Economic and Financial Crimes Commission (EFCC) for alleged fraudulent activities.
The disclosure was made on Tuesday during his opening address at the CAC’s 35th-anniversary celebration, themed "Transparency for Development: The Nigeria Experience."
Magaji’s address served as a sharp critique of the nation's current regulatory loopholes. He called for the urgent creation of a single, harmonized national register for beneficial ownership, arguing that the existing fragmented system where sectors like the extractive industry maintain separate databases weakens national integrity and complicates law enforcement efforts.
A significant portion of the Registrar-General's report focused on the role of the banking sector in undermining corporate accountability.
Magaji expressed concern that despite the CAC flagging non-compliant companies as inactive for failing to disclose Persons with Significant Control (PSC), several financial institutions continue to allow these entities to operate accounts and move funds.
"This is a major weakness in our national compliance chain," Magaji stated. "If a company is not compliant, it must not enjoy the privileges of legality."
He urged the National Assembly to transition the current "Persons with Significant Control" rules into a formal Act of Parliament to provide a more robust legal framework for enforcement.
Demonstrating a zero tolerance policy for corruption within his own agency, Magaji disclosed that three CAC staff members were recently handed over to the Independent Corrupt Practices and Other Related Offences Commission (ICPC) for unauthorized tampering with company records.
In addition to the 248 fake companies sent to the EFCC, another 15 entities have been identified and submitted for prosecution due to illegal transactions.
The Registrar-General also flagged a sophisticated method of concealment where large corporations list other legal entities as beneficial owners rather than the actual individuals behind the business.
He warned that this practice creates layers of concealment that hinder asset tracing and accountability.
The event saw strong support from Nigeria's leading anti-graft agencies.
Representing the ICPC Chairman, Dr. Musa Aliyu, Director Ademola Kareem emphasized that transparency is most effective when institutions operate as a unified system rather than in silos.
He noted that national development is ultimately a function of strong institutions and shared values.
Echoing this sentiment, the Chairman of the EFCC, Olanipekun Olukoyede, represented at the event, detailed a three-pronged strategy of prevention, investigation, and prosecution.
The EFCC maintained that a preventive framework is the most cost-effective way to secure the nation's financial integrity, noting that stopping a crime before it occurs yields far greater national gains than dealing with the aftermath of illicit activities.
The anniversary event concluded with a panel session aimed at charting a roadmap for institutionalizing transparency, with all stakeholders agreeing that stronger alliances between the CAC, banks, and law enforcement are essential to winning the war against systemic corruption.