Institutionalising the war against corruption – New approaches to assets tracing and recovering (5)

The Act relates essentially to acts of corruption in the public sector. Section 47 provides for criminal forfeiture of corruptly-acquired assets.

Mike Ozekhome


Few months ago, I took an abstract into the paper I delivered at the 2018 Nigeria Bar Association (NBA), Abuja, but was unable to continue and conclude same because of some urgent national issues that engaged my immediate attention. Today, I shall continue our discourse as to how to cure Nigeria’s present travails, continuing with the Constitution of the Federal Republic of Nigeria, 1999 (as altered), which we had earlier started in our last outing.

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Any asset acquired after declaration, which is not fairly proportional to income, is deemed to have been acquired in breach of the Code, unless the contrary is proved. Section 15 establishes the Code of Conduct Tribunal to deal with complaints of corruption against public servants for breaches of the provisions of the Code. Section 18(2)(c) vests the Code of Conduct Tribunal with the power to punish a public officer by means of seizure and forfeiture of assets acquired in abuse or corruption of office. Such seizure or forfeiture can occur only where the Tribunal has established a finding of guilt. A public officer may appeal as of right to the Court of Appeal against the decision of the Code of Conduct Tribunal. However, the Constitution contains provisions, which place limits on the prosecution of public officers for acts of corruption. These limits no doubt have hampered efforts to recover corruptly-acquired assets. One such provision is section 308 of the Constitution. The section provides thus:

“Notwithstanding anything to the contrary in this Constitution, but subject to subsection (2) of this section, no civil or criminal proceedings shall be instituted or continued against a person to whom this section applies during his period of office… This section applies to a person holding the office of President or Vice President, Governor or Deputy Governor; and the reference in this section to ‘period of office’ is a reference to the period during which the person holding such office is required to perform the functions of the office.”

Many public officers have often hidden under the cloak of section 308 of the Constitution to shield them and give them access to dissipate their ill-gotten assets.

The Corrupt Practices and Other Related Offences Act of 2004

The Act establishes the Independent Corrupt Practices and Other Related Offences Commission (the Commission) thus:

“There is hereby established a Commission to be known as the Independent Corrupt Practices and Other Related Offences Commission (hereinafter in this Act referred to as “the commission”)”

Under the Act, accepting gratification, offering a bribe to a public officer, fraudulent acquisition of assets, falsification of records, bribery relating to the award of contracts, and attempt or conspiracy to commit any of the above offences. The Act relates essentially to acts of corruption in the public sector. Section 47 provides for criminal forfeiture of corruptly-acquired assets. By virtue of section 47, the court can make an order for the forfeiture of assets where, in the course of prosecution, the offence is proved against the accused or the court is satisfied that neither the accused nor a purchaser in good faith for valuable consideration has title to the property. Section 48 provides narrowly for non-conviction based asset forfeiture. With respect to section 48, the chairman of the Independent Corrupt Practices Commission, in the absence of prosecution or conviction and within a period of twelve months from the date of seizure of the corruptly-acquired assets, may apply to a judge of the High Court for an order of forfeiture. The judge is required to publish, in the official gazette and at least two national newspapers, a notice of court attendance by persons with interests in the property. Such persons must show cause why the property should not be forfeited to the government. Section 48(4) provides a time-bar for forfeiture applications. The application for an order of forfeiture must be brought within 12 months of the date of seizure; otherwise the property will be released to the person from whom it was seized. However, civil forfeiture of corruptly-acquired assets under section 48 is in exhaustive. A comprehensive law on civil asset forfeiture is required to capture new forms of value or wealth.

The Economic and Financial Crimes Commission Act (EFCC ACT), 2004

The Act establishes the Economic and Financial Crimes Commission (EFCC) thus:

There is established a body to be known as the Economic and Financial Crimes Commission (in this Act referred to as “the Commission”) which shall be constituted in accordance with and shall have such functions as are conferred on it by this Act.

The EFCC is the designated financial intelligence unit (FIU) in Nigeria, vesting it with power to coordinate various institutions involved in the fight against money laundering and in the repression of all financial crimes. The Act was adopted in response to threats by the Financial Action Task Force (FATF) to blacklist Nigeria as a high-risk zone for economic and financial crimes. The Act criminalises terrorist financing, retention of proceeds of criminal conduct, and acquisition and conversion of property which are the proceeds of crimes under the Act. The Act also vests the Commission with power to enforce the provisions of all laws dealing with economic and financial crimes, which laws include the Money Laundering Act of 2004, the Advance Fee Fraud and other Related Offences Act of 1995, the Failed Banks (Recovery of Debts) and Financial Malpractices in Banks Act of 1994 as amended, the Banks and other Financial Institutions Act of 1991 as amended, the Miscellaneous Offences Act of 2004, as well as the Criminal and Penal Codes. Thus, the EFCC does not deal only with acts of corruption in the public sector. In recent times, it has spread its tentacles to the private sector, as seen in the arrest, investigation and prosecution of ex-bank directors on charges of money laundering and corruption. In relation to recovery of corruptly-acquired assets, the EFCC Act contains more detailed provisions than the Anti-Corruption Act, but provides only for criminal asset forfeiture in sections 20 and 21. Upon conviction for an offence under the EFCC Act, all assets which are the proceeds or instrumentalities of such offence are liable to forfeiture to the federal government. Forfeiture under section 20 is ordered in addition to any other sentence imposed under the Act as penalty for the offence. However, prosecution often is fraught with several procedural hurdles which result in very long delays and frustrate the entire asset recovery process. Section 22 provides for forfeiture of foreign assets held by convicted persons which are the proceeds of crimes. The Act also provides for forfeiture of assets which are the gross receipts obtained by commission of a crime under the Act, as well as forfeiture of instrumentalities of crime such as means of conveyance, records, negotiable instruments and real property. The Act also specifically makes provision for the tracing of assets thus:

Where a person is arrested for an offence under this Act, the Commission shall immediately trace and attach all the assets and properties of the person acquired as a result of such economic or financial crime and shall thereafter cause to be obtained an interim attachment order from the Court.

Money Laundering (Prohibition) Act Of 2004

The Act proscribes all forms of money laundering activities. Under 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 is, or forms part of the proceeds of an unlawful act; commits an offence of money laundering under the Act. The Act further makes provision for the punishment of offenders whether individuals or corporate bodies. Section 15 (3) of the Act provides that where a person contravenes the provision of subsection 2 of section 15 of the Act, such a person is liable upon conviction to a term of imprisonment not less than seven years but not more than 14 years where it is a corporate body a fine of not less than 100% of the funds and properties acquired as a result of the offence committed and withdrawal of license and where such corporate body persists in the commission of the offence, it may have its certificate revoked. To appropriately monitor the movement of physical cash the Act provides that no person or body corporate shall, except in a transaction through a Financial Institution, make or accept cash payment of a sum exceeding N5,000,000.00 or its equivalent for individual case or N10,000.000.00 or its equivalent, in the case of a body corporate. The Act under section 2 places a duty on a person to report any transfer of funds or securities exceeding the sum of US$10,000 or its equivalent to the Central Bank of Nigeria, Securities and Exchange Commission or the Commission in writing within seven days from the date of the transaction. Transportation of cash or negotiable instruments in excess of US$10,000 shall also be declared to the Nigerian Customs Service and the Nigeria Customs Service shall report any declaration so made to the Central Bank and the commission, failure to so declare or falsely declare, such a person shall be liable to forfeit the undeclared funds or imprisonment to a term of not less than 2 years or both.

Section 6 of the Act imposes obligations on financial institutions to verify customers’ details and identity. In the case of suspicious transactions, they are to submit written reports to appropriate authorities. The Act seeks extensive collaboration with such regulatory bodies as the Central Bank of Nigeria, Nigeria Customs Service, Nigeria Security and Exchange Commission, National Drug Law Enforcement Agency, Economic and Financial Crimes Commission, Corporate Affairs Commission and the Federal High Court. The Act makes it an offence for any person to convert or transfer proceeds derived from illicit traffic in narcotic drugs or psychotropic substances or any illegal act with the aim of concealing the illegal nature of the transaction. It is equally an offence to aid such illegal acts. It is also an offence for a director or an employee of a financial institution to alert the owner of the illicit funds of the report he is required to make or to destroy records required to be kept under the Act. Section 18 provides for forfeiture of assets of banks and financial institutions convicted of an offence under the Act. The Federal High Court has the discretion to wind up such a bank or financial institution and forfeit all its assets to the federal government. Forfeiture in this respect affects all assets, legally or illegally acquired.

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To be continued.


Thought for the week

“I believe that transparency is the solution to our problem on corruption.” (Grace Poe)

The post Institutionalising the war against corruption – New approaches to assets tracing and recovering (5) appeared first on The Sun Nigeria.

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