Illicit financial flows: Osinbajo seeks sanctions against banks, financial institutions

.Says looters now fighting anti-graft campaign through media

.Africa losing $80bn annually to illegitimate financial flows -ex-TI boss

Acting President, Professor Yemi Osinbajo, on Monday, called for sanctions against banks and other financial institutions that engage in illicit financial flows, just as he disclosed that corrupt persons who have stolen Nigeria’s resources were fighting the anti-corruption campaign of the All Progressives Congress (APC)-led administration through the media.

Osinbajo stated this at a conference on “Promoting International Cooperation in Combating Illicit Financial Flows and Enhancing Asset Recovery to Foster Sustainable Development,” organised by the Presidential Advisory Committee Against Corruption (PACAC) in collaboration with the Federal Ministry of Justice, adding that such banks and other financial institutions must be made to face the consequence.

Noting that it is not possible for illicit transfer of assets to be successfully effected without the connivance of both local and destination financial institutions, the Acting President Osinbajo called for delegitimisation and criminalization of the activities of such financial institutions so as to equally bring them to justice.

According to him, “there is no way the transfer of these assets can happen without a handshake between the countries that they are transferred and the international banking institutions in the countries in which they are transferred.

“There is no way it will happen without some form of connivance. So, we have to look at delegitimizing those kinds of financial institutions and criminalising them, so that banks and financial institutions that actually engage in these activities are called out and made to face the consequences of engaging in criminal practices”.

He said that “if that is not done, we are not likely to go very far.”

Osinbajo also disclosed that corrupt persons who have stolen Nigeria’s resources were fighting the anti-corruption campaign of the All Progressives Congress (APC)-led administration through the media.

According to him, there is a media war between people fighting corruption and those behind the stolen funds.
“It is called media trial. I don’t know what that means. If you discover for instance large sums of money in an air condition room, there is nowhere it will not make news anywhere in the world.

“Somehow proceeds from political corruption has not attracted the same outrage that proceeds from narcotics and trafficking in persons have attracted.

“It took years for some people to agree that when somebody loots money where people make a decent living that is more criminal than a crime against humanity, more dangerous than trafficking in drugs,” Osinbajo stated.

He warned that “unless Nigerians see corruption as a problem that can bring down our system, then we will never be able to fight. If you look at the anti-corruption fight in Nigeria, there is a major fight back in the media.

He also lamented that “The Mbeki report shows that most of the illicit fund’s flow that comes out of Africa are from Nigeria, adding that this “shows us very clearly especially the security agencies that we simply have to do more.

It is evident that so much money is leaving our shores.

“I was arguing with somebody about the fact that they were stopping certain funding, and he kept telling me Nigeria is no longer a poor country but now a mid-income earning country, so they shouldn’t be giving us those kinds of aids.”

“It was barely a week after that a large sum of money was found at the Kaduna airport and it was roughly about half of the money we were looking for.

“So, he sent me a text telling me that the money has been discovered at the Kaduna. Of course, I didn’t reply him but when he persisted and I called him and asked if this was his own form of a joke.

“But clearly it is sometimes absurd that when we are asking for aid and so much money is being stolen. So, we ourselves must take responsibility and ensure we keep talking about this.”

The Acting President, however, urged African nations to intensify efforts at recovering funds illicitly transferred, as according to him, it is not enough to talk about it.

“African countries and developing countries must realise that it is our responsibility, not only to identify where the funds are transferred but to ensure there are returned.

“Some countries are somehow reluctant about it, many have civil processes that make it difficult, they say our courts are handling this matter and there is very little we can do about. “We must make it a national call, a call for other developing countries to have the same outrage for drugs, terrorist financing and for illicit financial flows.

“We must emphasise at every point, and call out institutions that are not cooperating to ensure they recognise that this, for us, is a serious issue”, he added.

Earlier in his remarks at the conference, the Chairman, Presidential Advisory Committee Against Corruption (PACAC), Professor Itse Sagay, had revealed that 55 top government officials and private businessmen illicitly diverted the sum of N1.35 trillion and $7.5 million to themselves between 2006 and 2013.

He added that the immediate impact of corruption is that Nigeria is deprived of the capacity to realise its sustainable development goals of the United Nations.

“It is hard for any country to achieve that when it has looted 90 percent of its resources.”

According to him, “the annual flow of criminal activities is estimated at between $1 and $1.6 trillion and half of this comes from developing countries like ours. It is therefore vital that we increase our capacity of understanding the illicit financial flows if we are to meet our sustainable goals”, he said.

In his keynote address the Chairperson, International Anti-Corruption Conference Council, Akere T. Muna, said that Africa loses $50 to $80 billion annually through illicit financial outflows.

He expressed worry that despite the inflow of development assistance, Africa still remains a net creditor.

“The magnitude of these outflows is undeniable. The exactitude of the figures is secondary. Global capital flows have grown much faster than GDP and trade since 1980, but the global financial system continues to look unprepared and in some cases, simply reluctant to effectively regulate large volumes of cross-border flows.

“To be able to track illicit financial flows, it is important to understand the nature of the beast.” he said.
Muna said that the major reason secrecy in the financial system exists is to afford the rich and powerful tax planning opportunities.

“Once again, in our continent, a system that was put in place to ease business processes has been hijacked by greed and self-interests. It is imperative that we make it a priority to double efforts to end the use of financial secrecy for corruption, drug smuggling, money laundering, terrorism, people trafficking and other illicit financial practices.

“Also imperative for the tracking illicit financial flows is the implementation of existing commitments”, Muna added.

The Attorney General of the Federation (AGF) and Minister of Justice, Mr Abubakar Mallami, (SAN), said at the event that Nigeria’s ability to recover some of the illicit funds rely on the support and cooperation of the international community.

He expressed the belief that recovering of such funds will quicken the country’s recovery from recession.