Okey Wali SAN, President NBA, on August 26, 2013, chaired a plenary session with the topic: “Gatekeeper or whistle blower? – A lawyer’s reporting obligations under the money laundering regime” at the association’s 53rd Annual General Conference (AGC) which took place in Calabar.
In the 1990s the international community regarded Nigeria as a pariah state not only because of high level of money laundering but also because of advance fee fraud associated with Nigerians. Hence the country was blacklisted as a non-cooperative country having limited legal and regulatory framework to tackle Money Laundering and Financing of Terrorism by the Financial Action Task Force (FATF). It was for this reason that the Nigerian Financial Intelligence Unit (NFIU) was established June 2004 by then President Olusegun Obasanjo, in fulfilment of the requirement by FATF.
Presently, the NFIU is domiciled at EFCC and draws its powers from the EFCC (Establishment) Act of 2004 and the Money Laundering (Prohibition) Act of 2004 (2011).
The law requires lawyers to submit records of financial transactions about their current, existing and prospective clients to the NFIU and to the Special Control Unit Against Money Laundering (SCUML) where such is above the stipulated limit.
NBA President said that the association condemns criminal acts of money laundering and financing of terrorism and is willing to collaborate with all institutions established to fight the malaise as provided under the various laws.
He said however that it is an aberration for an external body such as the Central Bank of Nigeria (CBN) and the EFCC to seek to regulate the professional conduct of members of the NBA in so far as money laundering and financing of terrorism laws are concerned.
He said: “The NBA is competent and willing to self-regulate in accordance with the provisions of the Legal Practitioners Act.”
Juliet Ibekalu, one of the resource persons said that lawyers must register, adding that there is criminal and civil penalty for failure to report to SCMUL.
If lawyers are to comply they may need to employ additional hands and who pays the bill?.
Some participants however noted that the American Bar Association objected to external regulation and may take the matter to their Supreme Court.
Lawyers say that it is not right that a person (client) who has confessed to his lawyer should be handed over to the police. Other participants mentioned that lawyers in Nigeria could be victimised for political reasons which is not done elsewhere.
“We had an Attorney General of the Federation who did not prosecute money laundering but when he left office the culprits were thrown into jail in UK,” a participant pointed out, apparently referring to Ibori’s case.
Yet some lawyers believe that the NBA cannot do self regulation. “NBA has very weak internal regulation system hence those who prefer internal regulations have to think again.
Where was NBA when the law was been passed”.
Okutepa SAN also raised the issue of security for NBA officials and the ability and willingness to enforce NBA rules.
Lawyers mentioned that the CBN was also not accountable, saying that the CBN could not account for money they got from Cecilia Ibru.
Today, the NBA appears set for a showdown with the EFCC over the issue.
Law firms are categorised as Designated Non-Financial Institutions (DNFI) and must therefore register with SCUML and also comply with anti-money laundering regulations.
The NBA president said that lawyers would not comply with the regulations because they breached lawyer-client relationship, adding that a suit to stop the EFCC from harassing lawyers over compliance has been filed in court by a team of lawyers led by Chief Wole Olanipekun, SAN, a former president of the association to launch a legal assault on SCUML.
The suit, filed at the Federal High Court Abuja in the name of the Registered Trustees of Nigerian Bar Association listed CBN and the Attorney General of the Federation as first and second defendants respectively.
The lawyers asked the court to restrain the 1st and 2nd defendants (CBN and AGF) from seeking to enforce their directives to all banks in Nigeria against any member of the legal profession in Nigeria by preventing legal practitioners yet to register with SCUML from operating their respective bank accounts, pending the hearing and determination of the suit.
However, EFCC through SCUML is bent on enforcing the regulation.
The Central Bank of Nigeria (CBN) had also issued a directive to all banks not to allow law firms that have not registered with SCUML to operate their bank accounts. The apex bank gave a six-month deadline to update their records with the relevant institutions.
While some have complied many lawyers said that they have being receiving messages from their banks inviting them to show compliance with SCUML.
