Freeze accounts of terrorism financiers — CBN orders banks

The Central Bank of Nigeria (CBN) has ordered all banks and financial institutions to immediately freeze accounts linked to terrorism financing.

The directive follows fresh sanctions designations by Nigerian authorities and the United States Treasury Department over alleged connections to the Islamic State (ISIS).

In a circular issued on Thursday and signed by Olubunmi Ayodele-Oni, the apex bank directed financial institutions to act without delay on the updated sanctions list.

The move followed designations by the Nigeria Sanctions Committee and the US Treasury’s Office of Foreign Assets Control (OFAC), targeting three individuals and six entities accused of facilitating Islamic State financing.

Among those listed are three Nigerian Bureau De Change (BDC) operators based in Lagos and Kano, whose activities are said to be connected to the terror financing network.

The CBN instructed banks to immediately freeze, without prior notice, all funds, assets, and other economic resources belonging to, owned, held, or controlled directly or indirectly by the designated persons and entities.

Financial institutions must also screen all existing customers, beneficial owners, and ongoing transactions against the sanctions list. Furthermore, banks were directed to ensure that no funds, financial services, or economic resources are provided, directly or indirectly, to any of the blacklisted individuals or entities.

The regulator ordered financial institutions to file suspicious transaction reports with the Nigerian Financial Intelligence Unit (NFIU) for any confirmed or suspected matches.

“Financial institutions must submit reports to the CBN within 48 hours, detailing the status of any matches, affected accounts, amounts frozen, and actions taken. Nil returns are mandatory where no matches are identified,” the circular stated.

Financial institutions have also been told to heighten scrutiny of transactions showing classic terrorism financing red flags, including the rapid movement of funds, heavy use of money service businesses, and dealings involving high-risk jurisdictions.

The apex bank warned that non-compliance carries serious consequences.

Institutions that fail to implement the directive risk severe regulatory sanctions under the Banks and Other Financial Institutions Act (BOFIA) 2020 and other relevant laws.

The CBN stated that it will carry out off-site reviews, on-site examinations, and other supervisory checks to confirm full adherence.