According to Section 30 (Interpretative Section) of the Money Laundering (Prevention and Prohibition) Act, 2022, non-profit organizations (NPOs) in Nigeria are no longer listed among Designated Non-financial Institutions (DNFIs). The delisting of Nigerian NPOs from the DNFI category came into effect last week following the amendment of the Money Laundering (Prevention and Prohibition) Act 202 and the Terrorism (Prevention and Prohibition) Act 2022. The President has assented to these amendments. After six (6) years of constructive dialogue, sustained engagement with national authorities responsible for implementing anti-money laundering and countering financing of terrorism (AML/CFT) regimes and unrelenting advocacy demanding that NPOs be removed from the list of DFNIs, SPACES FOR CHANGE is very excited to see this happen at last!
SPACES FOR CHANGE has led advocacy pushing back on governmental restrictions on civil society either framed around countering terrorism and protecting national security or resulting from the perception of NPOs as conduits for money-laundering or the financing of terrorism. S4C’s 2019 research report, Unpacking the Official Construction of Risks and Vulnerabilities for the Third Sector in Nigeria, challenged the official classification of NPOs as DFNIs. It also interrogated the evidential basis for tagging DNFIs, of which NPOs are a subset, amongst those sectors most vulnerable to money laundering (ML) and terrorist financing (TF). To further avert blanket restrictions that occasion inimical consequences on the entire sector, the research strongly recommended a separate risk assessment of the NPO sector in line with the requirements of the Financial Action Task Force’s (FATF) Recommendation 8, with the aim of ascertaining NPOs that are likely to be “at risk” of terrorist financing.
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