Monday, October 26, 2020

Nigeria: Local Government Councils Battle Federal Government Over Money Laundering Guidelines


Thirty-one Local Government Councils in Akwa Ibom State and the Attorney-General of the state have approached the Federal High Court sitting in Uyo, Akwa Ibom State, to give an order of interlocutory injunction restricting the Nigerian Financial Intelligence Unit (NFIU) from carrying out its new guidelines on states’ control over funds belonging to their local governments.

The case with suit number FHC/UY/CS/88/2019, has the NFIU and the Attorney-General of the Federation has respondents.

The new guideline titled, “Enforcement, Guidelines, and Policies for Mitigating of Money Laundering, Terrorist Financing and Proliferation of Weapons”, was released on April 2019 and was scheduled to begin operation on June 1, 2019.

The guideline also seeks to ensure funds go directly to the accounts of local governments while placing a limit on cash withdrawals from local governments’ accounts to a maximum of N500,000 per day.

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Read More: Nigeria: NFIU Commences Financial Intelligence on 1st April

However, the guidelines have met stiff opposition from Nigeria’s state governors accusing the NFIU of interfering in matters outside of its mandate.

In an affidavit deposed to by Honourable Frank Archibong, the defendants claimed that the guidelines are not a law made by the Akwa Ibom State House of Assembly and it should not be applicable to the local councils in the state.

Giving a reason Akwa Ibom should be exempted from the NFIU guidelines, Archibong said, “Over 80 percent of people who are direct beneficiaries of the Local Government Administration in Akwa Ibom are poor indigenes residing in the rural areas and have no bank accounts.

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“That out of 31 Local Government Areas in Akwa Ibom State, it is only seven Local Governments that have banks in their Areas.”

Archibong stated that the refusal of the court to grant their prayer would put the lives of thousands of people who live in rural areas of Akwa Ibom in danger.


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