CORRUPTION AND OTHER RELATED OFFENCES II: Money Laundering and

Abuse of Function and Discretion.

Introduction

What is corruption? There is no generally acceptable definition of the term corruption as the
development of a precise definition always encounters legal, criminological and political
problems.1 This is because, many writers in offering a definition of corruption tend to limit it
to official, economic, political and administrative depending on their background which
could be legal, sociological or moral. 2 The definition of the term has included descriptions
like conflict of interest, breach of trust and abuse of principal, agent and client relationships
amongst others.

A common definition of corruption is ‘the abuse of public power for private benefit’.3 The
abuse of public power for private gain is a conflict between the obligation to exercise a public
power in the interest of the public and self-interest of the individual to use or exploit such
powers for his private gain. 4

However, a preferred definition of corruption which is almost all encompassing, is that

advanced by Rogets who defined corruption as ‘the departure from what is legally, ethically
and morally correct, lack of integrity or honesty, use of position of trust for dishonest gain,
moral perversion, impairment of virtue…, undermining moral integrity and inducement by
improper means to violate duty’. 5

In the past, the predominant focus of most writers, anti-corruption policies and legislation
was on the public sector thereby canvassing the understanding that corruption was limited to
the public sector only. This position has been debunked as an erroneous conclusion by a more
preferred view which is that, corruption could occur in private sectors especially since
corruption by public officials is often at the instigation of persons from the private sector.6

1 United Nations Handbook on Practical Anti-Corruption Measures for Prosecutors and Investigators. Vienna, September
2004 available at<https://www.unodc.org/pdf/crime/corruption/Handbook.pdf> accessed on 22nd July, 2016.
2 ICPC Anti – Corruption Tools (Journal December 16, 2002) p. 5
3 B.Erlend, ‘How Should corruption be measured?’ MSC Economics Essay (London School of Economics and Political

Science 2001) pg. 4

4
F. B. Okeshola, ‘Corruption as Impediment to the Implementation of Anti-money Laundering Standards in Nigeria’ 2
American International Journal of Contemporary Research No.7 (July 2012) pg. 184
5 Rogets, ‘A political Economy of Corruption and Under development’ (3rd Ed., the New Theserum, 1995)
6 G. Etomi, An Introduction to Nigerian Commercial Law : Text, Cases and Materials’, (Lagos: MIJ Professional
Publishers, 2014) pg. 451
Similarly, Elegido opines that there is an opportunity for corruption when you assign
discretionary powers of decision to a person and the exercise of such powers could affect the
interest of the other parties positively or negatively.7 He added that since this circumstance
could exist in the private sector then the opportunity of corruption in this sector is also
likely.8

In 2002, during the negotiations of the United Nations Convention against Corruption, it was
agreed that in avoiding the problem of defining corruption, it was best to rather list acts of
corruption.9 The United Nations Convention against Corruption (UNCAC) recognises the
following as acts of corruption or corruption related offences: Bribery of national public
officials; Bribery of foreign public officials and officials of public international
organizations; Embezzlement, misappropriation or other diversion of property by a public
official; Trading in influence; Abuse of functions; Illicit enrichment; Bribery in the private
sector; Embezzlement of property in the private sector; Laundering of proceeds of crime;
Concealment and Obstruction of justice. 10

However, this chapter will focus on corruption related offences such as money laundering,
abuse of function and discretion.

What is an Offence?

To appreciate the intendment and wordings of the legislations on corruption and related
offences, it is apt to define what an offence is. Primarily, the extant criminal law is the
Criminal Code operating in the then Southern Nigeria and the Penal Code in Northern Part of
Nigeria now domesticated as the Criminal Laws of the various States in Nigeria and the
Criminal Code Act for the Federal Capital territory (FCT), Abuja.

An offence is defined by the criminal code as, ‘an act or omission which renders the person
doing the act or making the omission liable to punishment under this code, or any Act or
Law.11 The Penal Code also provides, ‘except where otherwise appears from the context, the
word ‘‘offence’’ includes an offence under any law for the time being’.12

7 J. M. Elegido, ‘Fighting corruption in Nigeria’ 4 modus international law and business quarterly (no.1) 1999 pg. 84- 94.
8 ibid
9
Issues relating to attempts to define corruption for purposes such as policy development and legislative drafting are
discussed in more detail in the United Nations Manual on Anti-Corruption Policy, Part II.
10 United Nations Convention against Corruption, 2004. ( Chapter III Criminalization and law enforcement), Articles 15 - 25
11 Section 2 of the Criminal Code Act, Law of the Federation of Nigeria Cap. 77
12 Section 28 Penal Code Law 1959 of Northern Region.
Who then is guilty of an offence? Section 7 of the Criminal Code sets out persons who are
criminally culpable and liable to punishment for the commission of offences as principal
offenders. This category of offenders are persons who had carried out the act prohibited by
law themselves. The section of law provides thus:

‘When an offence is committed, each of the following persons is

deemed to have taken part in committing the offence and to be
guilty of the offence, and may be charged with actually
committing it,
(a) Every person who actually does the act or makes the omission
which constitutes the offence;
(b) Every person who does or omits to do any act for the purpose
of enabling or aiding another person to commit the offence;
(c) Every person who aids another person in committing the
offence;
(d) Any person who counsels or procures any other person to
commit the offence. In the fourth case he may be charged either
with himself committing the offence or with counselling or
procuring its commission...’13

Similarly, when an offence is committed, persons of common intent to prosecute an unlawful

purpose are all deemed to have committed the offence themselves. 14

Another category of offenders are accessories after the fact to the offence. A persons
becomes an accessory after the fact when he receives or assist persons who are guilty to his
knowledge, in order to enable them escape punishment.15 Though a wife of a Christian
marriage who assists or receives her guilty husband or another guilty person in the presence
of her husband or with his authority so that they may escape punishment is exempted from
punishment under this provision.

Therefore, in Law, when an act is criminalized, every person who: performs the act or
omission; does or omits to do an act for the purpose of enabling or aiding the commission of

13 Section 7 of the Criminal Code Act, Law of the Federation of Nigeria Cap. 77
14
Section 8 of the criminal Code Act ‘When two or more persons form a common intention to prosecute an unlawful purpose
in conjunction with one another, and in the prosecution of such purpose an offence is committed of such a nature that its
commission was a probable consequence of the prosecution of such purpose, each of them is deemed to have committed the
offence’.
15 Section 10 of Criminal Code Act.
an offence; aids the commission of an offence; procures or counsels a person to commit an
offence or receives and assist a person for the purpose of enabling them escape liability is
guilty of an offence and becomes liable to the extent of his participation.

Basically, for any act or omission to constitute an offence in Nigeria, it prohibition and
prescribed punishment must be contained in a written law as required by Section 36 (12) of
the Constitution which provides: ‘a person shall not be convicted of a criminal offence unless
that offence is defined and penalty therefore is prescribed in a written law, written law refers
to an Act of the National Assembly or a law of State, any subsidiary legislation or instrument
16
under the provision of a law’. Also a person cannot be guilty of an offence or liable to
punishment which does not exist at the time the offence was committed.17 This is the reason
for Legislations providing for the criminalizing and prohibition of offences in Nigeria.

1. MONEY LAUNDERING

The term Money laundering was first used in a legal context in 1982 in America in the case
US v $4,255,625.39, relating to the confiscation of laundered Columbian drug proceeds.18

According to the International Monetary Fund (IMF), the scale of money laundering globally
could be between 2% and 5% of the World Gross Domestic Product (GDP) translating to a
range of between 590 billion USD to 1.5 trillion of the money laundered per year. 19

Money laundering is the process by which criminals disguise the original ownership and
control of the proceeds of criminal conduct by making such proceeds appear to have been
derived from a legitimate source.20

The Vienna Convention defined money laundering as ‘the conversion or transfer of property,
knowing that such property is derived from any drug trafficking offenses or from an act of
participation in such offenses, for the purpose of concealing or disguising the illicit origin of
the property or of assisting any person who is involved in the commission of such an offense

16 Section 36 (12) Constitution of the Federal Republic of Nigeria 1999 as amended.

17 Section 36 (8) ‘no person shall be held to be guilty of a criminal offence on account of any act or omission that did not, at
the time it took place, constitutes such as offence, and no penalty shall be imposed for any criminal offence heavier than the
penalty in force at the time the offence was committed’.
18 I. Bantekas and G. Keramidas, International and European Financial Criminal Law: (Lexis Nexis –Butterworths 2006).

Pg.22.
19 M.T. Ladan, ‘International Legal and Administrative Regimes for Combating Money laundering and Terrorist Financing,’

(2012) 6 NJIL Journal, p.168

20International Compliance Association, ‘What is Money Laundering?’ available at < https://www.int-comp.org/careers/a-

career-in-aml/what-is-money-laundering/> accessed on 23rd June 2016.

or offenses to evade the legal consequences of his actions’.21 The Convention limited its
definition to laundering proceeds from drug trafficking offences and did not cover proceeds
from other offences like tax evasion, fraud, kidnapping and theft. 22

In 2000, the International community found that limiting the offence of money laundering to
proceeds from drug trafficking only will not result in the targeted goal and required all
Member States to apply the Convention to “the widest range of predicate offenses.” 23

The definition of money laundering was now stretched to include offences punishable by a
maximum deprivation of liberty of at least four years or a more serious penalty. 24 Hence,
broader definitions like ‘the concealment of the source, nature, existence, location and
disposition of money and/or property obtained illegally or from criminal activities such as
embezzlement, drug trafficking, arms trafficking, illegal gambling, terrorism, prostitution,
419, corruption and large scale crime through legitimate businesses into assets that cannot
be easily traced back to their illegal origins’ started to emerge.25

Money laundering consists of three main stages, placement, layering and integration. At the
placement stage, money launderers move the proceeds of their criminal enterprise to an area
where the proceeds could be hidden from legal authorities. 26 Next is the layering stage where
the proceeds are moved in a sequence of complicated financial transactions so as to distance
the money from the original source. 27 Finally, the capital is integrated into the financial
system by investing it in a legitimate business venture.28 All of which is made possible by the
advancement in technology which has made movement of funds from bank accounts and
countries across the globe an easy task. 29

21 United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances (1988) (Vienna
Convention)
22 Money Laundering and Terrorist Financing: Definitions and Explanations available at

< http://www1.worldbank.org/finance/assets/images/01-chap01-f.qxd.pdf> accessed on 21st June 2016.

23 Article 23 (2) (a) and (b) of United Nations Convention against Corruption, General Assembly resolution 58/4 of 31

October 2003.
24 Article 2 (b) of United Nations Convention against Transnational Organized Crime and the Protocols Thereto New York,

2004
25U. K. Ogbodo and E. G. Mieseigha, ‘The Economic Implications of Money Laundering in Nigeria’ International Journal of

Academic Research in Accounting, Finance and Management Sciences Vol. 3, No. 4, October 2013, pp. 170–184
26 The Monetary and Exchange Affairs and Policy Development and Review, ‘Financial System Abuse, Financial Crime and

Money Laundering-Background Paper, Feb. 12 2001. Available at

<http://www.imf.org/external/np/ml/2001/eng/021201.pdf> accessed on 11th June 2016
27 ibid
28 ibid
29 ibid
The criminal nature of money laundering cannot be overemphasized and as rightly pointed
out in the UN Convention against Corruption, this scourge has a number of negative impacts.
There include; the undermining of institutions, values of democracy, ethical values and
justice. It also jeopardizes sustainable development and the rule of law. Again because of the
large quantities of assets involved with this offence which is likely to form a substantial
proportion of the resources of States, the political stability and security of those States could
be threaten. Likewise, it was observed that it was no longer a local matter but a transnational
phenomenon that affects all societies and economies, thus making international cooperation
for its prevention and control essential.

1.1 REGULATORY FRAMEWORK FOR THE OFFENCE OF MONEY

LAUNDERING

The objective for criminalizing money laundering is to inhibit criminals from benefiting from
the proceeds of their criminal activity and preventing legitimate individuals and organisations
from facilitating the commission of such crimes by providing financial services to them. 30

The regulatory framework on money laundering differs from one jurisdiction to other.
However, International legislation has proven to be an important facilitator for the stride in
the regulation of corruption giving political legitimacy and impetus to the development of
Regional and National Laws to address the global concerns regarding corruption.

A. United Nations Convention against Illicit Traffic in Narcotic Drugs and

Psychotropic Substances 1988 (The Vienna Convention)

This was the first International attempt to criminalize money laundering. Although the
Convention only addressed drug related money laundering, it stressed that organized crimes
particularly drug trafficking could threaten the political stability and sovereignty of States. 31

The Convention requires State Parties to adopt such measures as may be necessary to
establish as criminal offences under its domestic law, the intentional conversion or transfer of
property derived from narcotic drug related offences for the purpose of concealing or

30International Compliance Association, ‘Why is money laundering illegal?’ available at < https://www.int-
comp.org/careers/a-career-in-aml/what-is-money-laundering/> accessed on 23rd June 2016.
31 A. Shehu, ‘the Risk of Corruption, Money Laundering, Financing of Terrorism and Organized Crime’ Paper Presented at

all Judges Conference 21-25 November 2011.

disguising the illicit origin of the property or assisting any person who is involved in the
commission of such an offence to evade the legal consequences of his actions.32

Also to be criminalized is the concealment or disguise of the true nature, source, location,
disposition, movement, rights with respect to, or ownership of property, knowing that such
property is derived from a drug related offence or an act of participation in such an offence. 33

B. The United Nations Convention against Transnational Organized Crime 2000

This Convention was adopted by the UN Millennium General Assembly in November 2000.
It is a binding International legal instrument focused on the promotion of cooperation to
prevent and combat transnational organized crime more effectively.34 It identifies that
corruption is both an instrument and an effect of organized criminal activity of a transnational
nature hence, the need for a global approach. 35

The Convention establishes that participation in organised criminal groups; money-

laundering; corruption and obstruction of justice are activities used in the support of
transnational organized crime. It therefore calls on States Parties to criminalize those
activities and adopt legislation and administrative systems to provide for extradition, mutual
legal assistance, investigative cooperation, preventive and other measures necessary to bring
existing powers and provisions up to the standards set by the Convention. 36

For the purpose of this Convention, organized criminal group means a structured group of
three or more persons, existing for a period of time and acting in concert with the aim of
committing one or more serious crimes or offences established in accordance with this
Convention, in order to obtain, directly or indirectly, a financial or other material benefit. 37

The Articles establishing the money laundering offence provides for States Parties to adopt,
to the greatest extent possible within their domestic legal systems, provisions to enable the
tracing, confiscation and forfeiture of the proceeds of crime or any other property used in, or
destined for use in an offence under the Convention.38 Once proceeds or other property have

32 Article 3 (1) (a) (i) -(v) United Nations Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances
1988 (The Vienna Convention)
33 Article 3(b) (i) and (ii)
34 Article 1 The United Nations Convention against Transnational Organised Crime, Resolution 55/22 of 15 th November,

2000
35
United Nations Handbook on Practical Anti-Corruption Measures For Prosecutors and Investigators. Vienna, September
2004available at < https://www.unodc.org/pdf/crime/corruption/Handbook.pdf>
36 Article 5
37 Article 2 (a)
38 Article 6
been so confiscated, they can be disposed of in accordance with the domestic laws of the
confiscating State, giving priority consideration to returning them to a requesting State Party
in order to facilitate the compensation of victims or the return of property to its legitimate
owner. 39

It also emphasises the need for Courts or other competent authorities to be given the requisite
powers to order disclosure or seizure of bank, financial or commercial records to assist in
asset tracking. It precludes bank secrecy from being raised as an obstacle to either the tracing
of proceeds or the provision of mutual legal assistance. 40

C. United Nation Convention against Corruption 2003

This Convention41 is the first international legally binding instrument on corruption and
related matters. The purpose is to prevent corrupt practices and illicit transfer of proceeds. It
aims at combating corrupt vices through the criminalization of these acts,42 promotion and
facilitation of international cooperation and technical assistance. It also encourages the
return of illegally transferred funds to countries of origin and the promotion of proper
management of public funds and affairs. 43
As part of the measures to prevent money-laundering, each State Party is required to institute
a comprehensive domestic regulatory and supervisory regime. This regime is expected to
require the identification of customer and beneficial owner, record-keeping and the reporting
of suspicious transactions by banks and non- financial institutions. This is also required of
natural or legal persons that provide formal or informal services for the transmission of
money or value and other bodies susceptible to money laundering. 44

Furthermore, parties are to ensure cooperation and exchange of information between money-
laundering regulatory law enforcement and other authorities at the national and international
levels within the conditions prescribed by its domestic law. Member States are also to
establish a financial intelligence unit to serve as a national centre for the collection, analysis
and dissemination of information regarding potential money-laundering.45

39 Article 7
40 ibid
41 United Nations Convention against Corruption, General Assembly resolution 58/4 of 31 October 2003
42
Article 23 (1) (a) (b)
43A. Argandona, ‘United Nations Convention Against Corruption and its impacts on International Companies’ Working

Paper W.P no.656 October, 2006, IESE Business School, University of Navarra.
44 Article 14 (1) (a) United Nations Convention against Corruption, General Assembly resolution 58/4 of 31 October 2003
45 Article 14 (1) (b)
In stipulating these predicate offences, the offences shall be made to include offences
committed both within and outside the jurisdiction of the State Party in question.46 The
offences committed outside the jurisdiction of a State Party constitutes a predicate offences
only when the relevant conduct is a criminal offence under the domestic law of the State
where it is committed and would be a criminal offence under the domestic law of the State
Party implementing or applying the Article had it been committed there. 47

Finally, each State Party is to furnish copies of domestic laws that give effect to the Article
criminalizing money laundering and of any subsequent changes to such laws or a description
thereof to the Secretary-General of the United Nations.48

In furtherance of the United Nations principles which encourages States to cooperate on a

regional basis, directly or through competent international organizations, in formulating and
elaborating rules, standards and recommended practices taking into cognizance regional
features, some regional framework have also emerged.

D. African Union Convention on Preventing and Combating Corruption 2003

The Convention was adopted by the Heads of State and Government of the African Union on
12 July 2003 for the prevention of corruption in Africa. The provision of this Convention are
similar to the United Nations Conventions discussed above although with slight variations.

Herein, each State Party is required to adopt such legislative measures as may be necessary
to enable its competent authorities to search, identify, trace, administer and freeze or seize
the instrumentalities and proceeds of corruption pending a final judgement.49

Accordingly, those authorities are to be empowered to confiscate proceeds or property and

where necessary repatriate the proceeds of corruption. Upon request, a State Party shall
subject to its domestic law and at the request of another State Party, seize and remit any
object which may be required as evidence of the offence in question. It is also necessary to
seize and remit any object acquired as a result of the offence for which extradition is
requested if found at the time of arrest or discovered subsequently.50 The objects may, if the

46
Article 23 (2) (a)- (c)
47 ibid
48 Article 23 (2) (d)
49 Article 16 African Union Convention on Preventing and Combating Corruption 2003
50 ibid
Requesting State so requests, be handed over to that State even if the extradition is refused
or cannot be carried out due to death, disappearance or escape of the person sought.

E. Economic Community of the West African States Protocol on the Fight against
Corruption 2001

The aims and objectives of the Protocol51 are to promote and strengthen the development of
effective mechanisms to prevent, suppress and eradicate corruption; intensify and revitalise
cooperation between State Parties, with a view to making anti-corruption measures more
effective and to promote the harmonization and coordination of national anti-corruption laws
and policies.

F. NIGERIAN FRAMEWORK

Before the Obasanjo administration, there were different variations of anti-corruption

framework like tribunals set up by past Heads of State; the War against Indiscipline by the
Buhari regime and many commissions set up to tackle corruption crimes. 52

The Nigerian government signed the United Nations Convention against Illicit Traffic in
Narcotic Drugs and Psychotropic Substances 1988 in March 1 and ratified it later in the same
year on November 1, 1989. Consequently, the government promulgated the Nigerian Drug
Law Enforcement Agency (NDLEA) Decree 48 of 1989 in furtherance of its obligations
under the Convention. The core purpose of the Statute was to criminalize trafficking in hard
drugs and allied acts. Even so, it criminalized the laundering of proceeds of hard drug related
offences as required by the UN Convention. 53

That notwithstanding, the high level of money laundering and advance fee fraud in Nigeria in
the late 1990s earned Nigeria the status of an exile State unfit to dine at the table.
Consequently, Nigeria was blacklisted and branded as a non-cooperative country by the
Financial Action Task Force (FATF). 54 This was also owing to the fact the country had
limited legal and regulatory framework to tackle Money Laundering and the Financing of
Terrorism.

51 Economic Community of the West African States (ECOWAS) Protocol On The Fight Against Corruption Senegal,
December 2001
52
B. Ibidolapo, ‘The Anti-Corruption Legal Framework and its Effect on Nigeria’s Development’, SPA Ajibade & Co.,
Lagos Nigeria Anticorruption Initiatives April 22, 2016.
53 A. A. Ige, ‘A Review of the Legislative and Institutional Frameworks for Combating Money Laundering in Nigeria’

NIALS Journal on Criminal Law and Justice Vol. 1 2011. See also section
54 ibid
In the effort to strengthen the global financial system and foster international cooperation in
the fight against money laundering and other corrupt activities, subsequent Nigerian
government have formulated a robust legislative and enforcement framework for the
implementation of International and regional instruments for combating money laundering. It
has also embarked on a number of amendments of obsolete laws to meet up with current
trends and anti-corruption related goals. Relevant provisions of selected Legislations are
summarized below.

I. Money Laundering (Prohibition) Act 2011 as amended

The first anti-money laundering legislation in Nigeria was enacted in 1995 to address the
adequacies of the Nigerian Drug Law Enforcement Agency (NDLEA) Decree 48 of 1989
which failed to curb the nuisance of money laundering which saw the diversion of huge
financial resources intended for the benefit of the people. Subsequently, the Money
Laundering Act was amended in 2003, 2004, 2011 and 2012 to strengthen the capacity of the
55
relevant agencies of the Government to deal with money laundering in the country. The
money Laundering (Prohibition) Act as amended by Money Laundering (Prohibition)
(Amendment) Act 2012 is the extant legislation on the prohibition of money laundering in
Nigeria although there is the new Money Laundering (Prohibition and Prevention) Bill, 2016
still undergoing debates and scrutiny before the National Assembly, which is seeking to
repeal this law.

Under Section 15 (2) of the Act, any person or body corporate, in or outside Nigeria: ‘who
directly or indirectly conceals or disguises the origin of, converts or transfers, removes from
the jurisdiction; or acquires, uses, retains or takes possession or control of; any fund or
property, knowingly or reasonably ought to have known that such fund or property is, or
forms part of the proceeds of an unlawful act; commits an offence of money laundering.

A person guilty of this offence is liable on conviction to a term of not less than 7 years but
not more than 14 years imprisonment.56 In the case of a body corporate, upon conviction is
liable to a fine of not less than 100% of the funds and properties acquired as a result of the
offence committed and withdrawal of licence. 57 Where the body corporate persists in the
commission of the offence for which it was convicted the relevant regulatory agency of the
55F. Falana, ‘Money Laundering: Interrogating Current Framework to Regulate Legal, Accounting, Property, Trust and
Company Sector Services ‘This Day Newspaper June 19, 2016.
56 Section 15 (3)
57 Section 15 (4) (a) (b)
business may withdraw or revoke the certificate or licence of the Corporation. 58 The penalties
stated above subsist notwithstanding that the various acts constituting the offence were
committed in different countries or places. 59

Money laundering ‘predicate offences’60 under the Act, includes the under listed offences or
any other criminal act. 1. Participation in an organized criminal group 2. Racketeering 3.
Terrorism and terrorist financing 4. Trafficking in persons 5. Smuggling of immigrants
6.Sexual exploitation and sexual exploitation of children 7. Illicit trafficking in narcotic drugs
and psychotropic substances 8. Illicit arms trafficking 9. Illicit trafficking in stolen goods
10.Corruption, Bribery and Fraud 11. Counterfeiting of Currency and piracy of products 12.
Environmental crimes 13. Murder and Grievous bodily injury 14. Kidnapping, hostage
taking, robbery or theft 15. Smuggling (including in relation to customs and excise duties and
taxes) and tax crimes (related to direct taxes and indirect taxes) 16. Extortion, forgery, piracy,
insider trading and market manipulation

In furtherance of the fight against money laundering, Section 1 provides, “No person or body
corporate shall, except in a transaction through a financial institution, make or accept cash
payment as a sum exceeding N5,000,000.00 or its equivalent, in the case of an individual; or
N10,000,000.00 or its equivalent in the case of a body corporate’.

Section 2 requires that a transfer of funds or securities of a sum exceeding $10,000 or its
equivalent to or from a foreign country shall be reported to the Central Bank of Nigeria, the
Securities and Exchange Commission or the Economic and Financial Crimes Commission in
writing within 7 days of the transfer.61 The report shall indicate the nature, amount of the
transfer and the names and addresses of the sender and receiver of the funds or securities. 62
Also, any transportation of cash or negotiable instrument in excess of the sum of US$ 10,000
or its equivalent by individuals in and out of Nigeria shall be declared to the Nigerian
customs Service who shall report such declaration to the Central bank and Economic and
Financial Crimes Commission. 63 Failure to make such declaration or the making of a false
declaration will amount to the commission of an offence and liability upon conviction to

58 Section 15 (5)
59 Section 15(7)
60 Section 15 (6). According the Law Society, ‘a predicate offence is an action that provides the underlying resources for

another criminal act’ available at < https://www.reference.com/government-politics/predicate-offence-f32f660ec1565abe>

accessed on 31st July 2016
61 Section 2 (1)
62 Section 2 (2)
63 Section 2 (3) (4)
forfeiture of the undeclared funds or negotiable instrument or to imprisonment of not less
than two years or both.64

The Federal High Court is vested with jurisdiction to try offences, hear and determine
proceedings arising under this Act or any other related enactment whether or not the offence
was commenced in Nigeria and completed outside Nigeria provided the victim is:

(i) a citizen or resident of Nigeria,

(ii) not a citizen of any country but ordinarily resident in Nigeria
(iii) in transit or has a link with Nigeria,
(iv) dealing with or on behalf the Government of Nigeria, or a citizen of
Nigeria or an entity registered in Nigeria, or
(v) The alleged offender and is in Nigeria and not extradited to any
other country for prosecution.

The Federal High Court also has jurisdiction to impose any penalty provided for an offence
under this Act or any other related law and shall have power, notwithstanding anything to the
contrary in any other enactment to adopt all legal measures necessary to avoid unnecessary
delays and abuse in the conduct of matters. Likewise, subject to the provisions of the
Constitution of the Federal Republic of Nigeria, an application for stay of proceedings in
respect of any criminal matter brought under this Act shall not be entertain by the court. 65

II. Economic and Financial Crimes Commission (Establishment) Act 2004.

The Act establishes the Economic and Financial Crimes Commission vesting it with powers
to define, investigate and prosecute economic and financial crimes. Even though the Act
does not use the term money laundering expressly, it criminalizes acts of money laundering.

Section 17 of the Act which similar to the provisions of Section 15 of the Money Laundering
(Prohibition) Act provides, ‘a person who whether by concealment or removal from
jurisdiction, transfers or retains the control of the proceeds of an economic or financial
crimes on behalf of another person knowing that the proceeds are as a result of criminal
conduct by the principal, or knowing that any property in whole or in part, directly or
indirectly representing another person's proceeds of an economic or financial crime,
acquires or uses that property or has possession of it, commits an offence’. Such a person is
64 Section 2 (5)
65 ibid
liable on conviction to imprisonment for a term not less than 3 years or to a fine equivalent to
100 per cent of the value of the proceeds of the economic or financial crime or to both
imprisonment and fine.66

Also, the following persons are guilty of committing an offence under this Act and are liable
on conviction to the imprisonment for a term not less than two years and not exceeding three
years.67 Any person:

1. who engages in the acquisition, possession or use of property knowing at the time of
its acquisition that such property was derived from any offence under this Act; or
2. engages in the management, organisation or financing of any of the offences under
this Act; or
3. engages in the conversion or transfer of property knowing that such property is
derived from any offence under this Act; or
4. Engages in the concealment or disguise of the true nature, source, location,
disposition, movement, rights with respect to or ownership of property knowing that
such property is derived from any offence under this Act.
III. Advance Fee Fraud and other Fraud Related Offences Act 2006

The purpose of the Act is Prohibit and punish certain offences pertaining to Advance Fee
Fraud and other fraud related offences.

The Act provides that, a person who conducts or attempts to conduct a financial transaction
which in fact involves the proceeds of a specified unlawful activity with the intent to promote
the carrying on of a specified unlawful activity is guilty of an offence. 68 A person is also
guilty where the transaction is designed in whole or in part to conceal or disguise the nature,
the location, the source, the ownership or the control of the proceeds of a specified unlawful
activity; or to avoid a lawful transaction under Nigerian law. A person commits an offence
under this Act if he knows or ought to know that the property involved in the financial
transaction represents the proceeds of some form of unlawful activity. 69

The punishment for the commission of such offence or offences are, in the case of persons or
a director or secretary or other officer of a financial institution or corporate body liability on

66 Economic and Financial Crimes Commission (Establishment) Act 2004.

67 Section 18
68 Section 7 (1) Advance Fee Fraud and other Fraud Related Offences Act 2006
69 ibid
conviction to imprisonment for a term, not more than 10 years and not less than five years
and in the case of a financial institution or corporate body, to a fine of N l million. Where the
financial institution or corporate body is unable to pay the fine, its assets to the value of the
fine shall be confiscated and forfeited to the Federal Government. 70

However, where as a result of negligence, or regulation in the internal control procedures, a

financial institution fails to exercise due diligence as specified in the Banks and Other
Financial Institutions Act, 1991 as amended or the Money Laundering (Prohibition) Act 2011
in relation to the conduct of financial transactions which in fact involve the proceeds of
unlawful activity, the financial institution commits an offence and is liable on conviction to
refund the total amount involved in the financial transaction and not less than N100.000
sanction by the appropriate financial regulatory authority. 71

Equally, a director, secretary, employee or other staff of the financial institution who
facilitates, contributes or otherwise is involved in the failure to exercise due diligence
commits an offence and is liable on conviction to imprisonment for a term not less than three
years and may also be liable to be banned indefinitely for a period of three years from
exercising the profession which provided the opportunity for the offence to be committed. 72

IV. Other Relevant Laws and Regulations

Some other Laws, regulation and policies incidental to the control of money laundering in
Nigeria are: Fiscal Responsibilities Act 2010; Banks and Other Financial Institutions
(Amendment) Act 1991; Failed Banks (Recovery of Debts) and Financial Malpractices in
Banks (Amendment) Act 1994; Central Bank of Nigeria (Anti- Money Laundering and
combating the financing of terrorism in Banks and other Financial Institution in Nigeria)
Regulation 2013 and Central Bank of Nigeria’s Anti-Money Laundering/Combating The
Financing Of Terrorism (Aml/Cft) Risk Based Supervision (Rbs) Framework, 2011.

1.2.REGULATORY INSTITUTIONS.

The ineffectiveness of the existing framework evidenced in the predominance of the 419
advanced fee fraud and money laundering crimes which became a perpetual cause of national
shame leading to a decline in Foreign Direct Investments into the country led to the

70 Section 7 (2)
71Section 7 (3)
72 ibid
establishment of the Economic and Financial Crimes Commission (EFCC) and other
regulatory bodies.73

A. Economic Financial Crimes Commission (EFCC)

The Commission is established by the Economic and Financial Crimes Commission

(establishment) Act and is tasked with the duty of enforcing the provisions of laws or
regulations relating to economic and financial crimes.74

Section 1(2) (c) of the EFCC Act, designates the Commission as the country’s Financial
Intelligence Unit charged with the responsibility of coordinating the various institutions
involved in the fight against money laundering.

It is the principal institution in combatting money laundering and is responsible for the
investigation of all financial crimes such as advance fee fraud (otherwise known as 419),
money laundering, counterfeiting, illegal charge transfer, futures market fraud, fraudulent
encashment of negotiable instruments of fraudulent diversion of funds, computer credit card
fraud, contract scam, forgery of financial instruments, and issuance of dud cheques. 75

The Act vests the commission with powers to adopt measures to identify, trace, freeze,
confiscate, or seize proceeds derived from terrorist activities, economic and financial crimes
related offences, or the properties, the value of which correspond to such proceeds. It is also
expected to adopt measures to eradicate and prevent the commission of economic and
financial crimes with a view to identifying individuals, corporate bodies or group involved. 76

The commission works in collaboration with the office of the Attorney General of the
Federation, Nigeria Customs Service, Immigration and Prison Service Board, Central Bank of
Nigeria, Nigeria Deposit Insurance Corporation, National Drug law Enforcement Agency
(NDLEA), all government security and law enforcement agencies and such other financial
supervisory institutions relevant in the eradication of economic and financial crimes. 77

73 See Ibidolapo (note 51)

74
Section 1 Economic and Financial Crimes Commission (Establishment) Act 2004
75 Section 6 (b)
76 Section 6 (d)
77 What are the Functions of EFCC? Available at < http://www.transparencyng.com/45-faq/efcc/1054-efcc.html> accessed

on 31st July, 2016

 B. Financial Action Task Force (TATF)

The FATF is the global coordinating body for Anti Money Laundering and the Combatting of
Financing of Terrorism (AML/CFT) efforts. It is charged with the promotion of sound
regulatory mechanisms for combatting money laundering / terrorism combatting and other
related financial activities. 78

It was formed in 1987 by the G-7 and currently has only 36 members with South Africa as
the only African member. 79 Even with scanty membership, the Recommendations of the body
serves as guidelines for the development of Regional and National anti –money laundering/
combating of financing terrorism (AML/CFT) regimes. For instance, Nigeria is not a member
of the body, but the Recommendations of the TATF has influenced the existing legal
framework and policies for combatting money laundering.

Amongst others in its Recommendation, the TATF calls on countries to establish a Financial
Intelligence Unit to serve as a National centre for the collection and analysis of Suspicious
Transaction Reports and other relevant information for dissemination to appropriate
authorities.80

C. Nigeria Financial Intelligence Unit (NFIU)

In line with Article 14 of United Nation Convention against Corruption 2003 and in
fulfilment of the requirement by FATF, the Nigerian Financial Intelligence Unit (NFIU) was
established in June 2004 by the Obasanjo’s regime. The Unit is empowered by the EFCC
(Establishment) Act of 2004, Money Laundering (Prohibition) Act 2011 as amended and the
40+9 Special Recommendations of the Financial Action Task Force (FATF).

It is domiciled at EFCC and is a member of Egmont Group of Financial Intelligence Units

and the coordinating Financial Intelligence Unit in West African sub-Region.81 It partners
with government, international organizations, regional institution such as the

78 The FATF Recommendations, International Standards on Combating Money Laundering and the Financing Of Terrorism
& Proliferation available at < http://www.fatf-
gafi.org/media/fatf/documents/recommendations/pdfs/FATF_Recommendations.pdf > accessed on 31st July 2016
79 ibid
80 ibid
81Nigeria Financial Intelligence Unit (NFIU) available at < https://efccnigeria.org/efcc/index.php/nfiu> accessed on 31 st July,

2016
Intergovernmental Action Group against Money Laundering in West Africa (GIABA) and
other Financial Intelligence Units (FIU) in the enforcement of AML/CFT regime. 82

The primary duty of the NFIU is the responsibility of receiving and analysing of financial
disclosure of Currency Transaction Reports and Suspicious Transaction Reports from
financial and designated non-financial institutions in line with Nigeria's anti-money
laundering and countering the financing terrorism (AML/CFT) regime. Its disseminates
intelligence to competent authorities thereby expanding the frontier as regards the
coordination, implementation and awareness on Anti-Money Laundering and Countering
Terrorism Financing. 83

The Unit also monitors compliance with AML/CFT Requirements and where necessary,
makes inputs to improve policies, regulations and laws based on findings from studies on
money laundering/terrorism financing. It also conducts training for stakeholders to enhance
their knowledge in AML/CFT policy formulation and compliance. 84

D. Special Control Unit against Money Laundering (SCUML)

The Special Control Unit against Money Laundering (SCUML) which was established in
2005 is also an in line with the Nigerian government’s commitment to the FATF through the
Presidential Inter-Agency Committee. The unit was established by the Federal Ministry of
Commerce and Industry (now Federal Ministry of Industry, Trade & Investment). 85

The Unit enforces the Money Laundering (Prohibition) Act 2011as amended, and other
pieces of legislation relevant to AML/CFT on Designated Non-Financial Institutions (DNFI)
as may be designated from time to time by the Federal Ministry of Trade and Investment 86

The statutory responsibility of SCUML is the regulation, supervision and monitoring of the
DNFI as regards compliance to Nigeria’s Anti Money Laundering and Combating the
Financing of Terrorism AML/CFT regime

In the efforts to sanitize and create an enabling environment for promotion of commerce and
investment and to cure the inadequacies of AML/CFT legislation and institutional framework

82 ibid
83
ibid
84 ibid
85Special Control Unit against Money Laundering (SCUML) available at <https://efccnigeria.org/efcc/index.php/scuml>

accessed 31st July 2016

86 Ibid
for curtailing Money Laundering and Terrorist Financing in the DNFI sector, the unit ensures
effective supervision of DNFI’s by, registration, inspection, ensuring rendition of statutory
reports, training and manpower development.

To this end, it collaborates with key stakeholders such as Self-Regulatory Organisations

(SROs), Non Profitable Organisations (NPOs), National Planning Commission (NPC),
Corporate Affairs Commission (CAC), EFCC and NFIU.87

E. Office of the Attorney General of Nigeria.

The office of the Attorney General is constitutionally created. He is empowered by section

174 (1) to institute and undertake all criminal proceedings regarded as a federal offence or
take over or continue and discontinue same before any court in Nigeria excluding a court
martial.88 This power could be exercised personally by him or through any officer of his
department.89

The Money Laundering (Prohibition) Act also clothes the Attorney General with powers to
make orders, rules, guidelines or regulations as are necessary for the efficient implementation
of the provisions of Act. 90

Accordingly, the Orders, rules, guidelines or regulations made in accordance with the Act
may provide for the:

1. method of custody of video and other electronic recordings of suspects apprehended

under this Act;
2. method of compliance with directives issued by relevant international institutions on
money laundering and terrorism financing counter measures;
3. procedure for freezing, unfreezing and providing access to frozen funds or other
assets;
4. procedure for the prosecution of all money laundering cases in line with international
human rights standards; and
5. Any other matter the Attorney - General may consider necessary or expedient for the
purpose of the implementation of this Act.

87 ibid
88Constitution of the Federal Republic of Nigeria1999 as Amended
89Section 174 (2)
90 Section 23 Money Laundering (Prohibition) Act 2011 as amended
 1.3.HOW EFFECTIVE IS THE ANTI- MONEY LAUNDERING REGIME IN
NIGERIA?

According to Adeseyoju, no country in West Africa has done more than Nigeria to enhance
anti-money laundering and combating the financing of terrorism regime.91 Between 2012 and
2013, about eight of the convictions recorded by the Commission where from money
laundering cases.

2013/2012 EFCC CONVICTIONS on Money Laundering

S/N SUIT NUMBER NAME OF PARTIES OFFENCE PUNISHMENT

1 FHC/KN/CR/192 FRN V. AMINU MONEY TO FORFEIT 25%
/2012 SULE LAMIDO LAUNDERING OF UNDECLARED
FUNDS

2 FHC/KN/CR/38/ FRN V. USMAN MONEY 1 YEAR

2013 SALIFU LAUNDERING IMPRISONMENT
OR N 250,000.00
FINE
3 FHC/L/36C/13 FRN V MONEY 25% OF
CHUKWUONO LAUNDERING UNDECLARED
NNAEMEKA SUM FORFEITED
TO FGN

4 FHC/L/168C/13 FRN V FATAI MONEY FORFEITURE OF

APAMPA ADESINA LAUNDERING $140,000.00 TO FGN
5 FHC/L/79C/13 FRN V AKINNOYE MONEY FORFEITURE OF $
ABIOLA LAUNDERING 51,205,00 T0 FGN
OLUWAFUNKE
6 FHC/KN/C FRN VS LDRIS MONEY FORFEITED $12,000
R/196/2012 HAMZA LAUNDERING
7 FHC/KN/C FRN VS UMAR MONEY FORFEITED $20,000
R/193/2012 MUSA KIBIYA LAUNDERING

8 FHC/KN/C FRN VS BASHIR MONEY FORFEITED

R/210/2012 ABDU LAUNDERING $65,000.00

Source: Economic and Financial Crimes Commission website 92

Just recently, Mr. Magu while speaking on a theme: ‘We Must Win the War on Corruption
and Impunity’ said that in just six months of this year, the EFCC had secured over 140

91
A. Adeseyoju, ‘Anti Money Laundering: FATF Moves Against WMDs’ Financial Action Task Force 2012 Available at
<http://www.momentng.com/en/news/6879/anti-moneylaundering-fatf-moves-against-wmds.html>accessed on 30th July
2016
92Economic and Financial Crimes Commission website <https://efccnigeria.org/efcc/index.php/public-notices> accessed on

July 31st 2016

convictions, recovering billions of dollars’ worth of stolen funds and blocked numerous
avenues of money laundering. 93

Whilst the development in anti-corruption policies and regulations, evidenced by numerous

arrest, arraignments and convictions of person alleged to be involved in the commission of
the offence is much appreciated, there is still so much to be desired. This is owing to the fact
that just like many other legislations and policies, the anti-money laundering regime suffers
from many challenges. Some of these challenges include;

1. Lack of independence of the anti-graft agencies and unnecessary politicizing of trials.

2. Multiplicity of legislations and agencies which results in wrestling for superiority.
3. Issue of technological advancement.
4. Lack of diligent prosecution
5. Inconsistencies between anti-money laundering legislations and other Laws
6. Unnecessary amendment of laws which creates more confusion rather that solving
previous lacunas
7. Issue of plea bargaining.
It has become glaring that the promulgation of laws and the establishment of new regulatory
institutions are not sufficient to combat the menace of money laundering as this must be
supported by strong political will on the part of government as there is need to improve the
standard of living of Nigerians to stir them away from corruption and its vices. 94

It is recommended that all law enforcement agencies at the federal and state levels and
financial sector must, in the spirit of cooperation and coordination, deprive terrorists and
money laundering of their finances and implement Anti-Money Laundering (AML) and
Counter-Terrorist Financing (CTF) laws. 95

Also for speedy dispensation, specialized courts should be created for the exclusive handling
of corruption and money laundering cases and Central banks should strengthen their
oversight and monitoring functions over private sector, commercial banks and other non-
bank financial institutions.96 Punitive measures on corrupt practices should be improved
upon.

Finally, to address the overlapping of functions of anti-graft agencies, the relevant laws
should be amended to confine their duties to only those stipulated in the Laws establishing
them.

93S. Ogundipe, ‘EFCC has secured 140 convictions, recovered billions of dollars in 6 months – Magu’ Premium Times, May
26, 2016 available at < http://www.premiumtimesng.com/news/top-news/204162-efcc-secured-140-convictions-recovered-
billions-dollars-6-months-magu.html> accessed 26th July 2016
94I. A. Abubakar, ‘An Appraisal of Legal and Administrative Framework for Combating Terrorist Financing and Money

Laundering in Nigeria Journal of Law, Policy and Globalization <www.iiste.org> Vol.19, 2013
95 ibid
96F. B. Okeshola Corruption as Impediment to Implementation of Anti -Money Laundering Standards in Nigeria American

International Journal of Contemporary Research Vol. 2 No. 7; July 2012 available at

<http://www.aijcrnet.com/journals/Vol_2_No_7_July_2012/22.pdf> accessed 31 July 2016
 2. ABUSE OF FUNCTION AND DISCRETION

The rate of arbitrary use of power by public office holders is alarming. It has left the entire
country with the ‘man know man’ syndrome where persons worthy of employment or other
entitlements are denied their due on account of nepotism and favouritism. All of these corrupt
vices has left the country in the present state of dysfunctionality. Whilst there is never a good
reason to abuse the power or office bestowed on a person, a huge part of corruption is blamed
on the poor living conditions of these officers whose take home pay barely gets home. These
officers are now forced to live by the dictates, whims and caprices of godfathers who are
readily available to influence decisions in their favour.

The word ‘abuse’ simply connotes ‘to use badly or wrongly’, ‘to abuse a privilege or misuse’
and could also be an ‘instance of injustice and corruption’.97

As a corrupt practice, it is said to include: breach of trust, deviation from rectitude,

dishonesty, distortion, erroneous use, excessive use, exploitation, fraudulency, ill-usage, ill-
use, improper usage, improper use, jobbery, malfeasance, misapplication, misappropriation,
misemployment, mishandling, mismanagement, misstatement, misuse, perversion, violation,
want of principle, wrong use, abuse of a mandate, abuse of a proceedings, abuse of authority,
abuse of discretion, abuse of executive authority, abuse of legal process, abuse of power,
neglect.98

Discretion is the power, right, choice, or flexibility granted to a decision maker to make
official decisions using reason and judgment to choose from among acceptable alternatives. 99

The Legislature, Executive, judiciary and administrative agencies are among the public
officers charged with making discretionary decisions in the discharge of public duties. In
many cases, corruption involves the abuse of function or discretion and are often attendant in
bureaucracies in which there are broad individual discretions and inadequate oversight and
accountability structures. 100 In examining the abuse of function and discretion, it is apt to
consider the powers wielded by public officials.

97N. Webster, ‘Webster's seventh new collegiate dictionary ( G. & C. Merriam Co.: 1969)
98
Legal Dictionary, available at <http://legal-dictionary.thefreedictionary.com/abuse> accessed on July 31st 2016
99Discretion in decision making available at < http://legal-dictionary.thefreedictionary.com/Discretion+in+Decision+Making

> accessed on 20th July 2016

100 United Nations Handbook on Practical Anti-Corruption Measures for Prosecutors and Investigators, Vienna September

2004 available at < https://www.unodc.org/pdf/crime/corruption/Handbook.pdf> accessed on 31st July 2016

Legislative Powers

The Legislature have very broad discretion to create and pass laws that prohibit, regulate, and
encourage a wide variety of activities. 101 By virtue of Section 4 of the 1999 constitution as
amended, the legislative arm of Government is vested with power to make laws for the peace,
order and good government of the Federation with respect to any matter included in the
Exclusive Legislative List, the Concurrent Legislative List and any other matter with respect
to which it is empowered to make laws in accordance with the provisions of this
Constitution.102 The House of Assembly of the State have similar powers but with respect to
any matter included in the Concurrent Legislative List.103

Nonetheless, the exercise of legislative powers by the National Assembly or by a House of

Assembly is limited by the constitution through the jurisdiction of courts and judicial
tribunals established by law. Accordingly, the National Assembly or a House of Assembly
shall not enact any law that ousts or purports to oust the jurisdiction of a court of law or of a
judicial tribunal established by law.104 Also, the Provision empowering the President or
Governor to assent to a Bill before enacting an Act is geared towards checking the legislative
powers to make law even though in some circumstances, the legislature can dispense with
such assent.105

Executive Powers

The executive powers of the Federation of Nigeria is vested in the President and may be
exercised by him either directly or through the Vice-President and Ministers of the
Government of the Federation or officers in the public service of the Federation. This
executive powers are in respect of the execution and maintenance of the Constitution and all
laws made by the National Assembly.106

The Governor of a State also exercises the executive powers of the State either directly or
through the Deputy Governor and Commissioners of the Government of that State or officers
in the public service of the State provided such exercise does not impede or prejudice the
exercise of the executive powers of the Federation; endanger any asset or investment of the

101 ibid
102
Section 4 (1),(2),(3), and (4) Constitution of the Federal Republic of Nigeria 1999 as amended
103 Section 4 (6) and (7)
104 Section 4 (8)
105 Sections 58, 59 and 100
106Section 148
Government of the Federation in that State; or endanger the continuance of a Federal
Government in Nigeria. 107

In exercising these powers, a wide range of discretionary powers avails the President or
Governor in making decisions including the discretion to assign the responsibility for any
business of the Government of the Federation or state, including the administration of any
department of government to the Vice-President or any Minister of the Government of the
Federation or Deputy Governor and Commissioners of the State as the case may be. The
assignees of these powers also are allow a wide range of discretion. Again these powers are
subject to the Provisions of the Constitution.

Judicial Powers

The judicial powers of the Federation is vested in the courts established for the Federation
and extend to all matters between persons, or between government or authority, any persons
in Nigeria and to all actions and proceedings for the determination of any question as to the
civil rights and obligations of that person. 108

Nevertheless, these powers are not without limitation as the decisions reached by Judges must
be made based on the rule of law, Common Law, or judicial precedents. For instance, a
Judges’ failure to abide by the sentencing guidelines in issuing a sentence would constitute an
abuse of judicial discretion. Where court decisions do not conform to both Statutes and
common law, they may be overturned by a reviewing court if that court determines that the
conclusions were an abuse of judicial discretion. In the case of Odega V. Olloh 109, the court
held that ‘Discretion of a Court or judge is the power or right conferred by the law on a Court
in acting in certain circumstances, according to the dictates of the judge’s or court’s own
judgment and conscience, uncontrolled and unfettered by the judgment or conscience of
others.’ Also, the Supreme per Peter-Odili JSC in Aboseldehyde Laboratories Plc. V. Union
Merchant Bank Limited & Anor110 held that Judges and Courts exercise their discretion in
accordance with rules of court and justice and not according to private opinion. He also
opined that an exercise of discretion is a liberty or privilege to decide and act in accordance
with what is fair and equitable under the peculiar circumstances of the particular case, guided
by the spirit and principles of law.
107 Section 193
108 Section 6 (1)
109(2015) LPELR 24568 (CA)
110 (2013) LPELR – 20180 (SC)
Abuse of function and discretion

The discretionary decisions made subject to the discretionary powers enjoyed by these
officials are in some cases subject to review and where there has been an abuse of discretion,
such decision could be reversed or modified.

Abuse of functions refers ‘to a public employee or public office holder doing something
which is illegal or something that the official has no legal authority to do, in order to obtain a
personal economic benefit or cause an illegal damage to others’. 111 An abuse of discretion on
the other hand occurs when the decision maker arrives at a decision which is logically
unsound, arbitrary and clearly not supported by the facts at hand, or unacceptable because it
is explicitly prohibited by a statute or Rule of Law.112 It is worthy of note that an abuse of
discretion often times results to incidents of abuse of function. For instance, if Mr A is vested
with discretionary powers to award a government contract to a worthy bidder, failure to
exercise that discretion in good faith (is an abuse of discretion) could amount to an abuse of
function especially if he chooses a less worthy bidder who happens to share some relationship
ties with him.

Recently, the National Judicial Council sacked two judges, Justice Mohammed Yunusa of the
Federal High Court, Lagos Division, and Justice Olamide Oloyede of the High Court of
Justice, Osun State, for alleged misconduct and abuse of office.113 Mr. Yunusa was sacked for
issuing illegal court orders restraining the office of the Attorney General of the Federation,
the EFCC and ICPC from carrying out investigation into alleged financial misappropriation
by public officers, including Senator Stella Oduah. 114

The essence of criminalizing these acts is to maintain a high standard of decorum and public
morality in the exercise of government business and to curtail the large scale of fraud which
has become a characteristic feature of the civil and public service. Incidents of abuse of
function and discretion tend to occur where decision making rules are so complex that they
neutralize the effectiveness of any accountability mechanisms. It is in this vein that anti-
corruption legislations and policies have evolved to curb these excesses.

111Business Anti- corruption Porta, ‘Corruption Vocabulary’ available at < http://www.business-anti-

corruption.com/about/about-corruption/vocabulary.aspx#Abuse> accessed July 20th 2016
112
ibid
113E. Okakwu ‘How cases involving Adenuga, Stella Oduah landed Judge in trouble’ Premium Times

July 17, 2016 available at < http://www.premiumtimesng.com/news/headlines/207058-cases-involving-adenuga-stella-

oduah-landed-judge-trouble.html > accessed 31st July, 2016
114 ibid
2.1 LEGAL FRAMEWORK ON ABUSE OF FUNCTION AND DISCRETION

Abuse of function and discretion has never really been at the fore of on anti-corruption laws
and scholarly work thus the reason for the relatively limited work on this topic. Nevertheless,
there are a number of provisions in corruption related offences legislations and policies
criminalizing acts that constitutes abuse of function and discretion. These relevant provisions
are considered below.

a. United Nations Convention on Corruption 2003

Article 19 of the Convention provides: ‘Each State Party shall consider adopting such
legislative and other measures as may be necessary to establish as a criminal offence, when
committed intentionally, the abuse of functions or position, that is, the performance of or
failure to perform an act, in violation of laws, by a public official in the discharge of his or
her functions, for the purpose of obtaining an undue advantage for himself or herself or for
another person or entity’.

The import of the foregoing is that an abuse of function entails the intentional performance or
failure to perform an act which is in violation of the Law for the purpose of obtaining some
form of due advantage for himself or another person or entity by a public officer. For
instance, an official responsible for government contracting may exercise discretion to
purchase goods or services from a company in which he or she holds a personal interest at a
cost higher than that available from other companies.115 Another example is where a public
officer charge with expending government funds for the execution of a government business
or decides to divert the funds so designated for his own use thereby neglecting to perform his
duty.

The above definition of abuse of function seems to focus on the acts of Public Officials. The
question that comes to mind is who then is a public official? A public official is anyone who
holds a legislative, administrative, or judicial position of any kind, whether appointed or
elected.116 Common examples include: ministers, civil servants, local government officials,

115 ibid
116What are Public Officials? Oxford University available at
<https://www.admin.ox.ac.uk/councilsec/compliance/briberyfraud/definitionsinterpretations/publicofficials/> accessed 31st
July 2016
the armed forces, officials or agents of public international organizations, police and other
security agencies.117

b. The Corrupt Practices and other Related Offences Act 2000

Although this Act uses the term official Corruption and not abuse of function, it criminalizes
this act of corruption. A person is guilty of the above offence and is liable to imprisonment
for seven (7) years if he corruptly:

(a) Asks for, receive or obtains any property or benefit of any kind for himself
or for any other person; or
(b) Agrees or attempts to receive or obtain any property or benefit of any kind
for himself or for any other person, on account of-
(i) Anything already done or omitted to be done, or for any favour or disfavour
already shown to any person by himself in the discharge of his official duties or
in relation to any matter connected with the functions, affairs or business of a
government department, or corporate body or other organization or institution
in which he is serving as an official; or
(ii) Anything to be afterwards done or omitted to be done or favour or
disfavour to be afterwards shown to any person, by himself in the discharge of
his official duties or in relation to any such matter as aforesaid. 118

Also, any public officer who uses his office or position to gratify or confer any corrupt or
unfair advantage upon himself or any relation or associate of the public officer or any other
public officer shall be guilty of an offence and shall on conviction be liable to imprisonment
for five (5) years without option of fine. 119

In addition to the punishments prescribed by sections 8 and 19, a public officer or other
persons found guilty of soliciting, offering or receiving gratification shall forfeit the
gratification and pay a fine of not less than five times the sum of the value of the
gratification.120

For the purpose of this Act, an official means any director, functionary, officer, agent,
servant, privy or employee serving in any capacity whatsoever in the public service or other
public body, or in any private organization, cooperate body, political party, institution or

117 ibid
118 See Section 8 The Corrupt Practices and Other Related Offences Act 2000
119 Section 19
120 Section 20
other employment, whether under a contract of services or contract for services or otherwise
and whether in an executive capacity or not.121

A Public Officer on the other hand “means a person employed or engaged in any capacity in
the public service of the Federation, State or Local Government, public corporations or
private company wholly or jointly floated by any government or its agency including the
subsidiary of any such company whether located within or outside Nigeria and includes
judicial officers serving in Magistrate, Area or Customary courts or Tribunals. The above
consideration is grounded on the fact that Sections relating to the offence of abuse of function
uses the two phrases.

c. Criminal Code Act

Similarly, the Criminal Code Act in prohibiting acts that constitute abuse of function,
provides thus, ‘any person who, being employed in the public service, does or directs to be
done, in abuse of the authority of his office, any arbitrary act prejudicial to the rights of
another is guilty of a misdemeanour, and is liable to imprisonment for two years. If the act is
done or directed to be done for purposes of gain he is guilty of a felony, and is liable to
imprisonment for three years. 122

d. Code of Conduct for Public Officers

Under the Code of Conduct for Public Officers, it will be regarded as an act of corruption for
a public officer to ask for or accept any property or benefit of any kind for himself or any
other person on account of anything done or omitted to be done by him in the discharge of his
duties.123 Any such receipt by a public officer of any gifts or benefits from commercial firms,
business enterprises or persons who have contracts with the government shall be presumed to
have been received in contravention unless the contrary is proved.

e. Code of Conduct Bureau and Tribunal Act

The Act provides for the establishment of the Code of Conduct Bureau and Tribunal to deal
with complaints of corruption by public servants for the breaches of its provisions.

121 Section 2
122Section 104 Criminal Code Act Chapter 77 Laws of the Federation of Nigeria 1990. A felony is
123 6 (1) The Code of Conduct for public officers, fifth schedule, part 1 of the 1999 constitution
The Act prohibits a public officer from doing or direct to be done, in abuse of his office, any
act prejudicial to the rights of any other person, knowing that such act is unlawful or contrary
to any government policy. 124

f. Code of Conduct for Judicial Officers

The Code requires all judicial officer to observe the following rules in the performance of his
duties.125

1. A Judicial Officer should avoid impropriety and the appearance of impropriety in all
his activities.
2. A Judicial Officer should respect and comply with the laws of the land and should
conduct himself at all times in a manner that promotes public confidence in the
integrity and impartiality of the Judiciary.
3. (a) A Judicial Officer must avoid social relationship that are improper or give rise
to an appearance of impropriety, that cast doubt on the judicial officers ability to
decide cases impartially, or that bring disrepute to the Judiciary.
(b) A Judicial Officer shall not be a member of any society or organisation that
practises invidious discrimination on the basis of race, sex, religion or ethnic origin or
whose aims and objectives are incompatible with the functions or dignity of his office.
4. A judicial Officer should be true and faithful to the Constitution and the law, uphold
the course of justice by abiding with the provisions of the Constitution and the law
and should acquire and maintain professional competence.
5. A Judicial Officer must avoid the abuse of the power of issuing interim injunctions,
ex parte.
6. A Judicial Officer should diligently discharge his administrative duties, maintain
professional competence in judicial administration and facilitate the performance of
the administrative duties of other Judicial Officers and court officials.
7. Judicial Officer should require his staff and other court officials under his direction
and control to observe the standards of fidelity and diligence that apply to him.
8. In the exercise of his administrative duties, a Judicial Officer should avoid nepotism
and favouritism.
2.2 REGULATORY INSTITUTIONS
a. Independent Corrupt Practices and other Related Offences Commission

The general duties of the Commission is to receive and investigate complaint and prosecute
offenders where reasonable grounds exist for suspecting that such a person has conspire to
commit or has attempted to commit or has committed an offence under the Act or any other
law prohibiting Corruption.

124 Section 13 Code of Conduct Bureau and Tribunal Act

125 See Rules 1,2,and 3 of the Code of Conduct for Judicial Officers
It also examine the practices, system and procedures of public bodies and where in the
opinion of the Commission, such practices, systems or procedures aid or facilitate fraud or
corruption, direct and supervise a review of them. The Commission also instructs, advice and
assist any officer, agency or parastatals on ways by which fraud or corruption may be
eliminated or minimized by such officer, agency or parastatal. It is also mandated to advise
heads of the public bodies of any changes in practices, systems or procedures compatible
with the effective discharge of the duties of the public bodies as the commission thinks fit to
reduce the likelihood or incidence of bribery, corruption and related offences. Finally it is the
duty of the Commission to educate the public and foster their support against bribery,
Corruption and related offences.

b. Code of Conduct Bureau

The code of Conduct Bureau and Tribunal was established in 1989 on the recommendation of
the Political Bureau to the Federal Military Government. Amongst the recommendation of
the Bureau was the need for the strengthening of existing machineries for monitory the
actions and behaviour of public officers, to ensure that they conform to the highest standards
of public morality and accountability.126 The powers of the Code of Conduct Bureau and
Code of Conduct Tribunal to enforce the code of conduct for public officers are enshrined in
the Third and Fifth Schedules of the 1999 Constitution of the Federal Republic of Nigeria (as
amended) and Code of Conduct Bureau and Tribunal Act127 .

The aims and objectives of the Bureau is to establish and maintain a high standard of morality
in the conduct of government business and to ensure that the actions and behaviour of public
officers conform to the highest standards of public morality and accountability.

The Bureau has the responsibility of receiving, examining, taking and retaining custody of
assets declarations by public officers in accordance with the provisions of this Act. The
Bureau also receives complaints about non‐compliance with or breach of the Act and where
necessary refer such complaints to the Code of Conduct Tribunal.

126J.B. Marshall and A. M. Murtala, ‘Public Service in Nigeria- An Overview of Functions and Code Of Conduct, Global
Journal of Politics and Law Research Vol.3, No.1, pp.61-69, March 2015
127 Cap 15 laws of the Federation of Nigeria, 2004.
c. Code of Conduct Tribunal

The Tribunal on the other hand has powers to impose punishment where it finds a public
officer guilty of contravening any of the provisions of this Act. The punishment which the
Tribunal may impose include any of the following‐

1. Vacation of office or any elective or nominated office, as the case may be;

2. Disqualification from holding any public office (whether elective or not) for a period not
exceeding ten years;

3. Seizure and forfeiture to the State of any property acquired in abuse or corruption of
office.

The punishments mentioned above are in addition to the penalties that may be imposed by
any law where the breach of conduct is also a criminal offence under the Criminal Code or
any other enactment or law as nothing precludes a public officer punished under this section,
from being prosecuted or punished for an offence in a court of law. Also, the provisions of
the Constitution of the Federal Republic of Nigeria 1999, relating to prerogative of mercy,
does not apply to any punishment imposed under Section 23 of the Act.

d. Federal Civil Service Commission

The Commission comprise of a Chairman and not more than fifteen other members, who
shall, in the opinion of the President, be persons of unquestionable integrity and sound
political judgment. The Commission has the power to appoint persons to offices in the
Federal Civil Service. It can also dismiss and exercise disciplinary control on officers of the
Federal Civil Service after consultation with the Head of the Civil Service of the Federation.

e. Federal Judicial Service Commission

The Commission has power to advice the National Judicial Council in nominating persons for
appointment to the office of the Chief Justice of Nigeria; Justice of the Supreme Court;
President of the Court of Appeal; Justice of the Court of Appeal; the Chief Judge of the
Federal High Court Judge of the Federal High Court; and the Chairman and members of the
Code of Conduct Tribunal.
It recommends to the National Judicial Council, the removal from office of the judicial
officers specified above. The Commission also appoints, dismisses and exercises disciplinary
control over the Chief Registrars and Deputy Chief Registrars of; the Supreme Court, the
Court of Appeal, the Federal High Court and all other members of staff of the judicial service
of the Federation not specified above and the Federal Judicial Service Commission.

f. National Judicial Council

The National Judicial Council have the power to recommend to the President from among the
list of persons submitted to it by the Federal Judicial Service Commission and the Judicial
Service Committee of the Federal Capital Territory for appointment to the offices of the
Chief Justice of Nigeria, the Justices of the Supreme Court, the President and Justices of the
Court of Appeal, the Chief Judge and Judges of the Federal High Court, and the Chief Judge
and Judges of the High Court of the Federal Capital Territory, Abuja, the Grand Kadi and
Kadis of the Sharia Court of Appeal of the Federal Capital Territory, Abuja and the President
and Judges of the Customary Court of Appeal of the Federal Capital Territory, Abuja.

It also recommend to the Governors from among the list of persons submitted to it by the
State Judicial Service Commissions persons for appointments to the offices of the Chief
Judges of the States and Judges of the High Courts of the States, the Grand Kadis and Kadis
of the Sharia Courts of Appeal of the States and the Presidents and Judges of the Customary
Courts of Appeal of the States. The Council recommend to the President and Governors the
removal from office of the judicial officers mentioned above and exercises disciplinary
control over such officers. Finally, the Council is empowered to collect, control and disburse
all moneys, capital and recurrent, for the judiciary.

CONCLUSION

In conclusion, there is no doubt that Nigeria has legislations and policies for regulating the
conduct of public officials. However, there is need for willingness on the part of the public
servants to adhere to the public service laws and regulations and not to violate the law. 128
Also it has been observed that there is lack of awareness of the content of the code of conduct
for public officers. The government or possible the Head of Civil service to embark on a
general awareness scheme to savage this situation.

128 J. B. Marshall and A. M. Murtala op cit.

Again there is need for a complete over hauling of membership of the various regulatory
agencies. Presently, most of the persons appointed are subject to the control and influence of
the President. This prevents independence of the agencies as they are now instruments for
witch hunting political opponents.

Although it is conceded that private sectors have their internal procedures and policies for
dealing with corruption with the supervision of Government agencies, it is recommended that
Legislations and government Policies be made to cover the Private sectors as extensive as the
Public sector.
WORK CITED

STATUTES

United Nations Convention against Corruption, 2004.

United Nations Convention against Illicit Traffic in Narcotic Drugs and Psychotropic
Substances (1988) (Vienna Convention)

United Nations Convention against Corruption, General Assembly resolution 58/4 of 31

October 2003.

United Nations Convention against Transnational Organized Crime and the Protocols Thereto
New York, 2004

The United Nations Convention against Transnational Organised Crime, Resolution 55/22 of
15th November, 2000

African Union Convention on Preventing and Combating Corruption 2003

Economic Community of the West African States (ECOWAS) Protocol on the Fight against
Corruption Senegal, December 2001

Constitution of the Federal Republic of Nigeria 1999 as amended.

Criminal Code Act, Law of the Federation of Nigeria Cap. 77

Penal Code Law 1959 of Northern Region

Corrupt Practices and Other Related Offences Act 2000

Economic and Financial Crimes Commission (Establishment) Act 2004.

Advance Fee Fraud and other Fraud Related Offences Act 2006

Money Laundering (Prohibition) Act 2011 as amended

Code of Conduct for public officers, fifth schedule, part 1 of the 1999 constitution

Code of Conduct Bureau and Tribunal Act

CASES

Odega V. Olloh (2015) LPELR 24568 (CA)

Aboseldehyde Laboratories Plc. V. Union Merchant Bank Limited & Anor (2013) LPELR –
20180 (SC)

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