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Cablegate: Central Bank of Nigeria On Freezing the Financial

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS ABUJA 002521

SIPDIS


E.O. 12958: N/A
TAGS: EFIN PTER NI
SUBJECT: CENTRAL BANK OF NIGERIA ON FREEZING THE FINANCIAL
ASSETS OF TERRORISTS


REF: (A) STATE 165224 (B) ABUJA 2416


1. This is an action request -- see para 6.


2. Summary. Emboffs met with CBN Deputy Governor Ebi to
discuss Ref A. Ebi promised to re-examine the CBN's
mechanisms to combat financial crimes and crack-down on
terrorists' financial activities. The CBN's International
Financial Crime Unit has authority to investigate and freeze
assets and provides support to the national police for
arrests and prosecutions. Financial crimes, however, do not
include money laundered from any source other than narcotics
trafficking. An amendment to the Money Laundering Decree
would be necessary to overcome this deficiency. Post
requests information from the Department. End Summary.


3. EconOff and RNLEO met September 27 with Central Bank
Deputy Governor Ernest Ebi to discuss President Bush's
Executive Order that enables U.S. authorities to crack-down
on terrorists' financial activities per Ref A. EconOff
presented Ebi with copies of the Executive Order. Ebi
promised that the CBN would re-examine its mechanisms to
combat financial crimes, including strengthening
investigations into terrorists' financial activities. He
commented that the International Financial Crime Unit, within
the CBN's Foreign Operations Department, has the authority to
investigate financial crimes, such as 419 frauds, and freeze
accounts and assets determined to be involved. It does not,
however, have the power to arrest or prosecute, he disclosed.
It might be possible, he said, to expand the mandate of this
unit.


4. Ebi said there is a committee comprised of officers from
the International Financial Crime Unit, the Money Laundering
Surveillance Unit (also under the CBN), and the International
Financial Surveillance Unit. This committee had proposed,
and may soon begin, issuing periodic reports on the findings
of its member agencies that would recommend specific actions
to be taken by the relevant Ministry, whether that be the
Ministry of Justice, the Central Bank or another agency. Ebi
mentioned that the CBN had implemented a new policy in 2001
whereby it would provide the national police with funding and
logistical support to facilitate financial crime prosecution.
As part of this program, the CBN also offers rewards for
successful prosecutions.


5. RNLEO pointed out that the FATF designated Nigeria a
non-cooperative country in 2001, in large part because the
governing law, the Money Laundering Decree of 1995, had major
deficiencies. The 1995 law only provides for the
investigation and prosecution of funds that have been derived
from narcotics trafficking, not for money derived from myriad
other criminal enterprises such as arms sales, trafficking in
persons or corruption. Ebi did not appear to be aware of
this shortcoming. He did, however, agree to look into the
issue. Ebi said he would meet with the CBN legal department
and task one of his officers to write recommendations on how
the Central Bank could move forward with prohibiting
terrorists from accessing financial resources.


6. Comment and Action Request. Even if the CBN were to
toughen its stance against financial crimes, these crimes
would not include money laundered from crimes other than drug
trafficking. Moreover, the CBN will remain dependent on the
police or NDLEA for criminal investigations and prosecutions.
One action the GON needs to undertake to crack-down on the
financial assets of terrorists is to reform the 1995 law or
draft new legislation that would rectify this deficiency.
Also key to effective money laundering controls will be the
creation of a central GON office -- probably within the
Presidency -- to coordinate law enforcement action among the
many GON agencies and serve as a money laundering information
clearing house (a "Financial Intelligence Unit" as called for
by the FATF). Post will work with the National Assembly, the
Presidency, Central Bank and Ministries of Justice and
Finance to encourage immediate action on this issue. Post
requests Department to provide text of U.S. laws and
regulations governing financial crimes and terrorist
activities that might help the GON in promulgating its
prospective new law and regulations on this issue. End
Comment and Action Request.
Jeter

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