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Loss of $384bn to illicite financial flow, Reps summons, Finance Minister, FIRS, others

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By Tom Okpe, Abuja

The House of Representatives at its plenary on Thursday, summoned the Minister of Finance, Chief Executives of the Federal Inland Revenue Service (FIRS), Central Bank of Nigeria, (CBN), Economic and Financial Crimes Commission (EFCC), Independent Corrupt Practices and Other Related Offences Commission (ICPC), Nigerian Export-Import Bank (NEXIM), Nigerian Financial Intelligence Unit (NFIU), and Nigerian National Petroleum Corporation (NNPC) over continuous loss of government revenue to illicit financial flows, amounting to about $384 billion.

The House mandated its Committees on Finance, Anti-Corruption, Financial Crimes, Banking and Currency, Insurance and Actuarial Matters to investigate the phenomenon of Illicit Financial Flows and appraise the Federal Governments current policy framework to curb the continuous loss of Nigeria’s revenues to illicit financial flows.

The House reached this resolution, following the adoption of a motion moved at plenary by Ochiglegor Idagbo, member representing Bekwarra/Obudu/Obanliku Federal Constituency of Cross River State.

Moving the motion, Idagbo said the Report of the Global Financial Integrity, 2014 showed that Nigeria lost a minimum of US$140 billion to illicit financial flows between 2000 and 2014, mainly to crude oil and commercial activities mispricing.

According to him, Nigeria was ranked among the global top 30 countries having Illicit Financial Outflows by dollar value and in 2015, a total of $8.3 billion was involved in the Illicit Financial Outflows.

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The lawmaker was disturbed that the Tax Justice Network and the International Monetary Fund (IMF) estimated that developing countries, including Nigeria, lose over $200 billion per year to illicit financial flows as Multinational Corporations neglect, fail and/or refuse to pay taxes, despite generating substantial
profits.

He observed that, “the net official Development Aid received by Nigeria in 2017 was $3,358,790,000 and the United States Agency for International Development (USAID) donated over $526.7 million in humanitarian assistance to Nigeria and the Lake Chad Basin since 2017, yet neither of the aforementioned figures matches the estimated $15 and $18 billion Nigeria loses to IFFs annually.

Nigeria continues to struggle with growing inequality, poor infrastructure and lacking service delivery.

“Gobal awareness has prompted governments to develop measures and policies such as the Organisation for Economic Co-operation and Development’s (OECD) and Common Reporting Standard (CRS) aimed at eradicating the perpetuation of IFF, and assist tax authorities track offshore holdings of taxpayers.

“Despite having at least 12 institutions and agencies responsible for tackling IFF and related crimes, Nigeria continues to be menaced by weak regulatory structures and complicity of other financial secrecy, among others.”

He is worried that an estimated 60% of IFF from Nigeria is predominantly committed by Multinational Corporations which continue to drive the cross-border, siphoning of the country’s revenues to the direct and indirect benefit of foreign economies.

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