ORGANISED CRIMES & THE LAW: A Comparative Study on Combating Money Laundering in Nigeria, India and Germany

reporting system.21 Firstly, the law creates control mechanisms to discourage huge financial transactions being conducted with the use of cash. Section 1(1) of PLMAA stipulates that no person or body corporate shall make or accept cash payment of a sum exceeding N500, 000 or its equivalent in the case of individuals, while in the case of a corporate body the amount is limited to N2, 000,000 unless the transaction is done through a financial institution. In doing so, financial institutions act as government agents for monitoring and regulating transactions involving huge sums. Secondly, and further to the above, PLMAA section 2(1) directs financial institutions to disclose any financial transaction exceeding a particular sum of money. It stipulates thus: A transfer to or from a foreign country of funds or securities of a sum exceeding US$10,000 or its equivalent shall be reported to the Central Bank of Nigeria. It goes further to provide that a report made pursuant to the above provision shall indicate the nature and amount of the transfer, the names and addresses of the sender and receiver of the funds or securities.22 The author submits that this provision is vital in the prevention of money laundering as perpetrators feel deterred from using of such financial institutions for money laundering, since publicity or the fear of publicity would expose their nefarious activities. Thirdly, in a bid to curb money laundering, like other comparator countries, Nigeria obligates financial institutions to enforce the Know-Your Customer (hereinafter KYC) requirements. This requires all financial institutions (including Bureaux de Change) to know the true identity of their customers and report to the relevant authorities any
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suspicious transactions concerning those clients accounts.23 Financial institutions are therefore expected to be vigilant in reporting all unusual and complex transactions notwithstanding any oath, contractual obligations, or arrangements with the customer and such reporters are immune from civil and criminal liability for those reports done in good faith though no offence of money laundering was actually committed and they did not know precisely the nature of the underlying criminal activity.24 Fourthly, the PMLA imposes an obligation of record keeping imposed on such financial institutions. In Nigeria records of transactions and customer identity are to be kept for 10 years, and any banker or person engaged in financial activities, who destroys records before the end of the prescribed statutory period is guilty of an offence.25 In the authors considered opinion, this is another area where the Nigerian AML Regime has taken a huge vital strides as it has even gone beyond FATF Recommendation that Banks and Financial institutions maintain records of their clients identification and transactions for up to 5 years during the operational life of the concerned account(s). 2.2.2 India Section 12, 2002 PMLA and Rule 8 of Notification No. 9 of 2005 impose an obligation on banking companies, financial institutions and intermediaries of the securities market to verify the identity of clients, maintain records and furnish information to the authorities whenever there are suspicious transactions.26

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Cf: Okogbule, op cit, at 453. MLPAA, Section 2(2)

Ezeani, op cit, 4 Ibid, 6 25 Ibid, 4 26 FIU-IND, Banking Company: Suspicious Transaction Report in Electronic File Structure, 2, available at

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