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CBN releases guidelines on terrorism financing sanctions

The Central Bank of Nigeria (CBN), has released the approved guidelines on how Financial Institutions (FIs) in the country should implement the Targeted Financial Sanctions (TFS) related to Terrorism and Terrorism Financing measures. According to the guidelines, which were posted on the apex bank’s website yesterday: “Targeted Financial Sanction involves both asset freezing and prohibitions to prevent funds or other assets from being made available, directly or indirectly, for the benefit of designated persons and entities.” Among other requirements, the guidelines stipulate that financial institutions should carry out regular and ongoing screening against the latest updates of UN Consolidated Lists and the Nigerian Sanction List, prior to conducting any transaction or undertaking any financial Services to ascertain whether or not the name of such a person or entity is on the Lists.

Specifically, the CBN’s guidance states that financial institutions should conduct screening when commencing processes such as, onboarding a new customer; facilitating an occasional transaction and establishing any relationship with any person or entity. Also, financial institutions are required to conduct screening: “Before carrying out any transaction; and upon review of Know Your Customer (KYC) or changes to a customer’s information.” The CBN stressed that: “Screening must be conducted immediately and without delay to ensure compliance with imple-menting freezing measures without delay (within 24 hours). “FIs are required to screen their entire customer base to prevent dissipation of funds of the designated persons or entities.

“FIs (including those operating in free trade zones) must constantly screen their customers, potential customers, beneficial owners, and transactions to identify possible matches to the UN Consolidated Lists. “FIs (including those operating in free trade zones) must constantly screen their customers, potential customers, beneficial owners, and transactions to identify possible matches to the UN Consolidated Lists.

“FIs shall undertake further screening and analysis on designated persons or entities whose properties or accounts are jointly owned and/or indirectly controlled by the designated persons or entities.” FIs are required to immediately implement TFS by identifying and freezing, without delay and without prior notice, all funds and assets owned or controlled by the designated person or entity in their possession. On the application of targeted financial sanctions, the CBN stated: “FIs are required to immediately implement TFS by identifying and freezing, without delay and without prior notice, all funds and assets owned or controlled by the designated person or entity in their possession.”

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