Home Latest Insights | News AML/CFT, Due Diligence, Targeted Financial Sanctions and Rules Of Professional Conduct Nigeria

AML/CFT, Due Diligence, Targeted Financial Sanctions and Rules Of Professional Conduct Nigeria

AML/CFT, Due Diligence, Targeted Financial Sanctions and Rules Of Professional Conduct Nigeria

Legal Practice :- AML/CFT Obligations Of The Nigerian Bar Association (NBA) & Targeted Financial Sanctions Under The New Rules Of Professional Conduct (RPC) 2024.

This article deals with the Anti-Money Laundering/ Combating The Financing Of Terrorism (AML/CFT) obligations imposed on the Nigerian Bar Association (NBA) & Targeted Financial Sanctions as outlined by the new rules of professional conduct (RPC).

We will thus be looking at these provisions in detail.

Tekedia Mini-MBA edition 14 (June 3 – Sept 2, 2024) begins registrations; get massive discounts with early registration here.

Tekedia AI in Business Masterclass opens registrations here.

Join Tekedia Capital Syndicate and invest in Africa’s finest startups here.

AML/CFT Obligations Of The NBA

– The NBA/AML Committee(AMLC) may solely undertake compliance examinations of law firms on a risk-based approach and the reports of such examination shall be forwarded to the Special Control Unit On Money-Laundering.

– The examination template shall be developed by the NBA/AMLC. 

Targeted Financial Sanctions (TFS)

– A lawyer shall put in place mechanisms to implement TFS related to terrorism and proliferation financing.

– A legal practitioner shall monitor and screen all persons and transactions on the United Nations (UN) Consolidated List of persons and entities designated by the UN in accordance with UNSCR 1267(1999) and its successor resolutions.

– A lawyer shall monitor and screen all persons and entities against the Nigerian Sanction list.

-Where there is a positive match on the UN Consolidated list of persons and entities designated by the UN in accordance with the UNSCR 1267(1999) and its successor resolutions and the Nigerian Sanction list, a legal practitioner shall :-

a). Immediately identify and freeze, without prior notice,all funds, assets and any other economic resources belonging to the designated person or entity in their possession and report same to the NBA AMLC for onward transmission to the sanctions committee.

b). Report to the NBA AMLC for onward transmission to the sanctions committee, any assets frozen or actions taken in compliance with the prohibition requirements of the relevant UNSCR, including attempted transactions.

c). Immediately file a Suspicious Transaction Report (STR) to the NBA AMLC for onward transmission to the Nigerian Financial Intelligence Unit (NFIU), all cases of name matching in financial transactions prior to or after receipt of the Nigerian Sanctions list.

Legal Practice :- AML /CFT Risk-Based Approaches & Client Due Diligence Requirements For Legal Practitioners Under The New Rules Of Professional Conduct (RPC) 2024 

This article will be dealing with  the requirements of the new rules of professional conduct (RPC) for legal practitioners in Nigeria regarding risk-based approaches and client due diligence requirements for legal practitioners.

These provisions are as follows :-

Risk-Based Approach

– A legal practitioner shall identify, assess and understand the money laundering, terrorism financing and proliferation financing risks they may be exposed to in a given transaction, and take reasonable and proportionate measures effectively and efficiently to mitigate & manage such risks.

– A legal practitioner shall in identifying and maintaining an understanding of the money laundering and terrorism financing risks, understand the money -laundering , terrorism financing risks specific to his services and client base , as well as create an effective control mechanism in place for the purpose of mitigating any such risks.

– A legal practitioner and law firm shall :- 

a). develop internal policies, procedures and controls including appropriate compliance management arrangements, and adequate screening procedures to ensure high standards when hiring employees;

b). develop and provide ongoing employee training programmes commensurate with the complexity of their responsibilities.

– The following steps shall be adapted by legal practitioners and law firms to minimize money laundering and terrorism financing risks on every transaction they are instructed to carry out by clients :-

  1. a) . Legal practitioners & law firms shall as far as reasonably possible :

(i). Identify & verify the identity of their clients, whether natural or artificial, their addresses whether permanent or temporary, as well as their beneficial owners, and ascertaining the beneficiaries of the transaction being instructed to be carried out.

(ii). Obtain an understanding of the source of funds and source of wealth of the client and the purpose of the transaction.

b). Legal practitioners or law firms shall know the exact nature of the service that they are providing & understand how that brief  may unwittingly facilitate the movement or obscure the proceeds of crime & take necessary mitigating steps as provided. 

Risk Types or Factors

– There is no universally accepted set of risk categories, as such  the examples provided in these rules are the most identified risk categories.

– There is also no single methodology to apply these risk categories and the application of these risk category is intended to provide contextualized situations for approaching the assessment and management of potential money laundering or terrorism financing risks.

– To identify risks for small law firms and sole practitioners, recourse should be given to the services they offer.

No posts to display

Post Comment

Please enter your comment!
Please enter your name here