OSAS EMMANUEL
NIGERIA: The Central Bank of Nigeria (CBN) has elevated the supervision of terrorism financing risks to a current priority, signalling increased regulatory scrutiny of how financial institutions identify, monitor and report transactions that could be linked to the financing of terrorism.
The apex bank said the move formed part of its continuing efforts to safeguard Nigeria’s financial system from abuse by illicit actors and strengthen controls designed to prevent the country’s financial sector from being exploited for unlawful activities.
In a statement signed by the Acting Director, Corporate Communications and Investor Relations Department, Hakama Sidi-Ali, the CBN said its strengthened supervisory focus would cover several key areas of terrorism financing risk management.
These include the effectiveness of financial institutions’ terrorism financing risk-management frameworks, transaction monitoring systems, implementation of targeted financial sanctions and the reporting of suspicious transactions relating to terrorism financing.
The Bank said the enhanced focus would be implemented through a risk-based supervisory approach, involving both on-site and off-site engagements with regulated financial institutions.
According to the CBN, the objective is to support effective anti-money laundering, countering the financing of terrorism and counter-proliferation financing controls across the financial sector, in accordance with existing laws and regulatory requirements.
The latest supervisory emphasis comes as financial regulators globally continue to place greater importance on preventing criminals and terrorist networks from exploiting legitimate financial channels to move, store or access funds.
For Nigeria, the CBN’s announcement places particular emphasis on the responsibility of financial institutions to maintain effective systems capable of identifying unusual or suspicious transactions and escalating them to the appropriate authorities where necessary.
The apex bank also highlighted the importance of targeted financial sanctions, which are designed to restrict access to financial services and assets by individuals and entities subject to sanctions under applicable legal and regulatory frameworks.
The CBN said its supervisory focus would also support Nigeria’s ongoing domestic and international cooperation in areas including counter-terrorism financing, counter-proliferation financing and broader financial integrity.
It added that protecting the integrity of the financial system remained central to its regulatory responsibilities, particularly as illicit actors continually seek ways to exploit financial institutions and payment channels.
The Bank stressed that its approach would remain risk-based, suggesting that supervisory attention would be directed according to the nature and level of risks identified within institutions and their operations.
The CBN said further supervisory engagement would be undertaken as appropriate, indicating that financial institutions should expect continued regulatory attention to their terrorism financing controls.
The announcement effectively places terrorism financing risk alongside other major compliance concerns requiring financial institutions to maintain robust internal controls, transaction-monitoring mechanisms and reporting systems.
It also reinforces the need for banks and other regulated financial institutions to comply with Nigeria’s existing anti-money laundering, counter-terrorism financing and counter-proliferation financing obligations.
The CBN said the enhanced supervision was part of its ongoing commitment to protecting the Nigerian financial system from abuse and strengthening the country’s wider financial integrity framework.
