Insurers to face stringent sanctions over currency transaction reports infractions

Chuks Udo Okonta

Insurance firms will henceforth face stringent sanctions over failure to report currency transactions of their customers to the Nigerian Financial Intelligence Unit (NFIU), Inspen has learnt.

Director NFIU Mrs Juliet Ibekaku, disclosed this at the National Insurance Commission (NAICOM) Sensitisation Programme on Anti-Money Laundering and Combat of Financing of Terrorism Control Measures for Insurance Companies in Lagos.

She noted that the NFIU's end of year reports shows that only 3871 Currency Transactions Reports (CTRs) were submitted by insurance companies last year, adding that the Unit would not hesitate to apply stringent sanctions provided in the Money Laundering Prohibition (MLP) Act 2011 as amended in 2012 and the Prevention of Terrorism Act (PTA), 2011 as amended in 2013, if the companies persist in not complying with the laws and regulations.

Ibekaku said failure to file currency transaction reports and suspicious transaction reports is a criminal offence, which the NFIU will enforce working closely with its counterpart in the law enforcement agencies and NAICOM.

She said: "The NFIU would like to reiterate that failure to file CTRs and STRs is a criminal offence which the NFIU will enforce working closely with its counterpart in the law enforcement agencies and NAICOM.

The responsibility to take specific and timely action to prevent the financial system from reputational and legal risks rests mainly with the insurance companies in the first instance because of the nature of the services and products they offer to their customers and because of the type of clientele they serve."

She noted that in the next couple of days the NFIU in collaboration with NAICOM intends to issue further guidance on some of the emerging issues that have been observed.

She said the Anti-Money Laundering law, mandates that financial institutions should report single transactions, lodgement or transfer of funds in excess of N5 million or N1 million by an individual and N10 million or N5 million by a corporate entity to the NFIU.

Deputy Director Inspectorate NAICOM, Emmanuel Farinu, said efforts are being made by the Financial Action Task Force (FATF) to review jurisdictions globally to identify areas that pose risk to international financial system and determining the extent of compliance with anti-money laundering and combating financing of terrorism requirements.

Assistant Director Inspectorate NAICOM Sam Onyeka, said the commission has put in place measures that would enable all the operators to have a harmonised CTRs and STRs reporting system.