Nigeria has trained 100 officials in Abuja to prepare for an upcoming anti-money laundering (AML) and counter-terrorism financing (CTF) assessment. The training, described as a Mock Mutual Evaluation Exercise, aims to ensure the country meets international standards for financial transparency and security.
The initiative involved the Nigerian Financial Intelligence Unit (NFIU), the Inter-Governmental Action Group against Money Laundering in West Africa (GIABA), and SecFIN Africa. Key participants included Hafsat Abubakar Bakari, Chief Executive Officer of the NFIU; Giwa Siman, Director of Evaluation and Compliance at GIABA; and Professor Shehu Abdullahi, Country Representative of SecFIN Africa.
The exercise follows Nigeria’s removal from the Financial Action Task Force (FATF) grey list nearly a year ago. The government is now moving to institutionalise the reforms that led to that removal to avoid being relisted.
FATF standards and financial stability
The FATF is the global watchdog for money laundering and terrorist financing. Its “grey list” identifies jurisdictions that have strategic deficiencies in their AML/CTF regimes. While not a complete blacklist, being grey-listed often leads to increased scrutiny of financial transactions, higher costs for domestic banks to maintain correspondent banking relationships, and a general decline in foreign investor confidence.
For Nigeria, maintaining its status off this list is critical for attracting Foreign Direct Investment (FDI) and reducing the cost of doing business across borders. The Mutual Evaluation process is the formal mechanism used by FATF and its regional bodies, such as GIABA, to determine if a country is not only passing laws on paper but effectively implementing them to catch financial criminals.
GIABA, which serves as the FATF-Style Regional Body (FSRB) for West Africa, oversees the compliance of member states within the region. The mock exercise in Abuja allows Nigerian officials to identify gaps in their current reporting, investigation, and prosecution frameworks before the formal assessment takes place.
The training focused on the “effectiveness” criteria of the FATF standards. This requires Nigeria to prove that its law enforcement agencies are successfully freezing assets, securing convictions for money laundering, and identifying the beneficial owners of companies used to hide illicit funds.
The outcome of the upcoming formal assessment will determine whether Nigeria continues to be viewed as a compliant jurisdiction. Failure to meet these standards could lead to renewed pressures from international financial institutions and a possible return to the grey list, which would complicate international trade and remittance flows.
The NFIU and GIABA are expected to monitor the application of the training outcomes as the country prepares for the final evaluation deadline.
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