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Money laundering: Banks’ brainstorm over new sanction regime

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By Babajide Komolafe

THE new Anti Money Laundering/Counter Financing Terrorism (AML/CFT) sanction regime announced by the Central Bank of Nigeria (CBN) has triggered a series of top management brainstorming sessions amongst banks over implications and implementation.

The new regime among other things seeks to punish top officials of banks, namely, directors, chief compliance officers and internal auditors, for money laundering/financing terrorism infractions committed by their banks.

According to the CBN, banks and their board members or chief compliance officers will all be sanctioned for 31 out of the 48 money laundering infractions listed in the new regime.

Though the new regime was released last week, Vanguard investigation revealed it was not officially communicated to the banks until yesterday morning. Investigation also revealed that some of the banks have commenced or scheduled meetings and trainings to brainstorm over the implications of the sanction regime and measures to ensure compliance so as to avoid the punitive sanctions stipulated in the new regime.

Confirming this to Vanguard, Managing Director/Chief Executive, FSDH Merchant Bank, Mrs.   Hamda Ambah said: “We are already fixing a special executive meeting to go through everything and understand the implications to make sure we are in compliance now and in going forward with every item that has been listed there. And we also have a board meeting this week, on the day of our AGM, and we are going to sensitise our directors to the content of the circular. And then the audit and risk committee of the board will take it forward because we take the pronouncement of the CBN very seriously here”.

Some of the infractions and penalties stipulated under the new regime include:   failure to approve the AML/CFT policies and procedures -a minimum penalty as follows: N1 million on each member of the board and N20 million on the Deposit Money Banks (DMB).

Failure to review/update the AML/CFT policies and procedures at least every three (3) years, a minimum penalty as follows: N750,000 on the executive compliance officer in the first   instance and   N750,000 for each year that the contravention continues. N500,000 on the chief compliance officer in the first instance and N500,000 for each year that the contravention continues.

Failure to communicate the AML/CFT program of the organization to the employees attracts a minimum penalty as follows: N750,000 on the executive compliance officer, N500,000 on the chief compliance officer and N10 million on the DMB.

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