C O N F I D E N T I A L SECTION 01 OF 02 ABUJA 002793

SIPDIS


DEPT FOR INL AND AF
TREASURY PASS TO FINCEN


E.O. 12958: DECL: 11/01/2011
TAGS: SNAR PTER KCRM NI
SUBJECT: NEW FINANCIAL CRIMES COMMISSION TO TAKE ON
TERRORISM


1.(U) Classified by Timothy D. Andrews, Charge' d'affaires
for reasons 1.5 (b) and (d).


2.(C) Summary: On the eve of President Obasanjo's November 2
visit to Washington, the GON added terrorism to the tasks of
a planned Financial Crimes Commission (FCC). The draft law
establishing the FCC gives it sweeping powers to control and
coordinate disparate GON agencies' efforts to fight money
laundering, financial crimes and terrorism, as well as to
investigate and prosecute offenders. Not surprisingly, given
the Ministry of Justice's role in drafting the legislation,
the Attorney General would play a key role in controlling the
new Commission. The addition of terrorism to the FCC's
mandate seems artificial and contrived. It was probably done
as a symbol of political commitment to anti-terror efforts.
End Summary


3.(C) RNLEO October 31 obtained a copy of the GON's draft law
creating a "Financial Crimes Commission." (copies will be
hand carried to Washington prior to the November 9 bilateral
law enforcement committteee meeting). This draft is the
product of several months of work by the Attorney General's
staff and until recently the document did not contemplate the
FCC being the leads anti-terrorism agency. On October 29,
however, the Presidency reportedly directed that the draft
law be amended to incorporate anti-terrorism efforts. Changes
were quickly made -- a "rush job" confided an official in the
National Security Advisor's office. The law now creates the
"Terrorism, Economic and Financial Crimes Enforcement
Commission" (TEFCEC).


The Commission Players
--------------


4.(SBU) The draft law provides for a Commission headed by a
Chairman who "shall be a serving or retired member of any
government security or law enforcement agency" appointed by
the President for a term of four years. Members of the
Commission will include representatives of the following
agencies: the Ministry of Justice; the Nigerian Police
Force; the National Intelligence Agency; the State Security
Service; Nigerian Telecommunications; the Nigerian Postal
Service; and the Central Bank of Nigeria. (Comment: Though
not cited, the

National Drug Law Enforcement Agency is part
of the Ministry of Justice. End Comment) In addition, "four
eminent Nigerians" with experience in finance, banking or
accounting will serve as members of the Commission. The
draft legislation calls for staffing of the Commission with
officers seconded from government security or law enforcement
agencies. Within the Commission will be four units: general
and assets investigations; legal and prosecution; research;
and administration.


Commission's Investigative Functions
--------------


5.(SBU) According to the draft law, the TEFCEC will be
responsible for "the investigation of all serious financial
crimes including advance fee fraud, money laundering,
counterfeiting, illegal charge transfers, futures market
fraud, fraudulent encashment of negotiable instruments,
computer credit card fraud, contract scam, etc. of and above
the value of naira 5,000,000 or its equivalent."
(approximately USD 44,000) The TEFCEC is charged with
enforcing the following existing laws: a) the Money
Laundering Act of 1995; b) the Advance Fee fraud and Other
Related Offences Act of 1995; c) the Failed Banks (Recovery
of Debts) and Financial Malpractices in Banks Act of 1994; d)
the Banks and Other Financial Institutions Act of 1991; and
e) any other law or regulations relating to terrorism,
economic or financial crimes.


6.(SBU) Also cited is a specific responsibility to adopt
"measures to identify, trace, freeze, confiscate or seize
proceeds derived from terrorism, economic and financial crime
related offences or the properties the value of which
corresponds to such proceeds. Similar to powers granted in
existing laws, the Commission can forfeit seized assets, but
usually only upon conviction. A new tool granted to the
TEFCEC is a Declaration of Assets Form that must be completed
by any person arrested for committing an offence under the
TEFCEC act. On this form, the person must disclose all
assets and properties and the form is then forwarded to the
investigations unit of the Commission for full investigation.
These assets are then subject to an interim forfeiture order
(seizure). The failure to fully disclose assets and
properties on the form is a crime subject to up to ten years
imprisonment, according to the draft TEFCEC law.


Coordination Role of Commission
--------------


7.(SBU) The draft law stipulates that the TEFCED will be
responsible for "collaborating with government bodies both
within and outside Nigeria." Also, "taking charge of,
supervising, controlling, coordinating all the
responsibilities, functions and activities relating to the
current investigation and prosecution of all offences
connected with or relating to terrorism, economic and
financial crimes, in consultation with the Attorney General
of the Federation; the coordination of all existing
terrorism, economic and financial crimes investigating units
in Nigeria; maintaining a liaison with the office of the
Attorney General of the Federation, the Nigerian Customs
Service, the Immigration and Prison Service Board, the
Central Bank of Nigeria, the Nigerian Deposit Insurance
Corporation, the National Drug Law Enforcement Agency, all
government security and law enforcement agnecies and such
other financial supervisory institutions in the eradication
of economic and financial crimes."


8.(C) Comment: While we leave thorough analysis of the draft
legislation to legal experts in Washington, the financial
crimes portion seems to reflect some thought and study on
both the structure of the Commission and its designation of
investigative and prosecutorial powers. Moreover, it seems
to address the major concerns of the FATF and international
community in improving centralized control and coordination
of GON-wide anti-money laundering efforts and in creating an
entity to respond to international requests for information.
The sudden addition of terrorism to the Commission's mandate,
is ill-fitting. In presenting RNLEO with a copy of the
revised draft, the Legal Assistant to the National Security
Advisor commented that in their haste to amend the draft law
to cover terrorism-related crimes, the drafters appear to
have slapped the term "terrorism" into the draft text
repeatedly without defining it or terrorist crimes as has
been done in the draft with financial crimes. This seems to
be a a major legal flaw. This addition is probably inteded
to symbolize the GON's commitment to anti-terrorism efforts.


Andrews