Nigeria Loses $400bn to Illicit Financial Flows - Malami

News

The Minister of Justice and Attorney-General of the Federation, Abubakar Malami (SAN), yesterday decried the level of illicit financial flows, noting that Nigeria has lost over $400 billion to some foreign tax havens. The funds, according to the AGF were either stolen or expatriated by corrupt leaders and their foreign accomplices, including multinational companies. Malami’s Media aide, Dr. Umar Gwandu made the disclosure while speaking at the eighth session of the Conference of States Parties to the United Nations Convention Against Corruption in the United Arab Emirate (UNCAC), taking place from December 16 to 20, 2019.

According to the minister, Nigeria noted with great concern the incidence of illicit financial flows which go through the financial systems annually, particularly from developing to developed economies. “The quantum of these illicit flows which are majorly proceeds of crime undermines local currencies, constitutes a threat to the economy, and enhances the risk of huge amounts of money flowing into channels such as organized crimes and terrorism”.

He said the government has taken drastic measures to address the problem in order to ensure that Nigerian financial institutions and banks are not used as conduits for these illicit transactions. “To dissuade the perpetrators of this anomaly including financial institutions who act as enablers, State Parties should ensure that illicit financial flows, when tracked, do not remain in the custody of enabling financial institutions, but should be transferred into escrow account, preferably in Development Banks pending return to countries of origin,” he said.

According to the minister, “bad eggs among public officials have been compromised by multinational companies and our resources looted and diverted through inflated contracts.” Malami noted that with the return of democratic governance in 1999, the country has recorded significant progress in the fight against corruption. “We have enacted legal frameworks and established several dedicated institutions focused on preventing and combatting diverse manifestations of corruption.”

He said the federal government has established numerous policies to promote transparency and accountability and prevent corruption before it occurs through institution of mechanisms that ensure data–policy nexus and inter-agency coordination and established a robust access to information regime in the Freedom of Information Act, ensuring increased transparency and accountability.

“We have committed to the Open Government Partnership and beneficial ownership disclosure and adopted a roadmap for implementation. A few days ago, we launched two significant initiatives: The Open Treasury Initiative which establishes a financial transparency portal to keep the public informed about financial transactions within a specified threshold, on a daily basis, and a pilot Beneficial Ownership register focused on the extractive sector,” he said.

Malami said in realisation of the necessity of effective Criminal Justice System for investigating and sanctioning corruption, Nigeria is actively implementing the Justice Sector Reform Strategy covering issues such as International Cooperation Mechanisms, Mutual Legal Assistance and reform of the Criminal Justice System. “Proceeds of corruption and illicit financial flows constitute a huge chunk of resources needed for sustainable development but are regularly diverted from victim States,” he said. The Minister, therefore, called for simplification of evidentiary requirements and other mutual legal assistance procedures as appropriate to enhance international cooperation under the Convention. He said Nigeria believed that the Conference of States Parties has a vital role to play in identifying the most effective means of overcoming existing legal obstacles to asset recovery.