Money Laundering Act 2022 Overview

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Questions and Answers

What is the minimum imprisonment term for individuals convicted under subsection (2)?

Two years

Six years

Four years (correct)

Five years

What is the penalty for a body corporate that contravenes subsection (2)?

A fine not less than five times the value of the funds (correct)

A fine of seven times the value of the acquired funds

Imprisonment for the directors

A warning issued by regulators

Which of the following acts is included in the unlawful acts covered under subsection (2)?

Participation in organized criminal groups (correct)

Voluntary court settlements

Contract breaches

Tax evasion on personal income

What happens if a body corporate continues to commit the offence after its first conviction?

The regulators may withdraw or revoke their license Signup and view all the answers

Which of the following is NOT listed as an unlawful act under subsection (6)?

Corporate mergers Signup and view all the answers

Which of the following crimes is associated with financing acts of terrorism as per subsection (6)?

Racketeering Signup and view all the answers

In what scenario does a person committing an offense under subsection (2) become subject to penalties specified in this section?

Even if the acts were committed in different countries Signup and view all the answers

What is one form of illicit activity defined in subsection (6)?

Environmental crimes Signup and view all the answers

Which of the following actions does NOT invoke legal professional privilege under the Money Laundering Prevention and Prohibition Act, 2022?

The creation of a will Signup and view all the answers

What is the penalty for an individual found guilty of establishing or operating a shell bank in Nigeria?

Imprisonment for at least two years Signup and view all the answers

According to the Act, which of the following is true regarding financial institutions and shell banks?

They are prohibited from entering correspondent banking relationships with shell banks Signup and view all the answers

Which of the following activities must a financial institution satisfy itself against when dealing with respondent financial institutions in foreign countries?

Usage of accounts by shell banks Signup and view all the answers

A financial institution can incur which of the following penalties for contravening the provisions regarding shell banks?

Prosecution of principal officers Signup and view all the answers

What is the maximum fine a corporate body can face for violations related to the establishment of shell banks?

N50,000,000 Signup and view all the answers

Which of the following options represents a legitimate action under the Act?

Conducting business transactions as usual Signup and view all the answers

In the context of this Act, what constitutes illegal activity relevant to legal professional privilege?

Acts produced in furtherance of unlawful acts Signup and view all the answers

Which of the following is NOT categorized as a designated non-financial business and profession?

Virtual asset service providers Signup and view all the answers

What is included in the definition of a 'financial institution'?

Insurance institutions Signup and view all the answers

Who is recognized as a 'competent authority' in combating money laundering?

Economic and Financial Crimes Commission Signup and view all the answers

Which of the following describes 'false declaration'?

Misrepresentation of currency value or required data Signup and view all the answers

Which of the following terms is defined as 'financial support of terrorism'?

Terrorism financing Signup and view all the answers

Which of these entities is classified as a 'designated non-financial business and profession'?

Casinos Signup and view all the answers

What does 'beneficial owner' refer to in the context of this regulation?

A person benefiting from a transaction or ownership Signup and view all the answers

Which definition pertains to individuals holding significant political positions?

Politically exposed persons (PEPs) Signup and view all the answers

Which of the following is NOT considered a transaction under this Act?

Buying a book Signup and view all the answers

What does 'shell bank' refer to within the definitions provided?

A bank not affiliated with regulated financial groups Signup and view all the answers

Which agency is responsible for acting as the financial intelligence unit in Nigeria?

Nigerian Financial Intelligence Unit (NFIU) Signup and view all the answers

What is the purpose of 'suspicious' activity as mentioned in the document?

To identify activity beyond mere speculation Signup and view all the answers

Which of the following actions is NOT included in the definition of a financial transaction?

Providing advice Signup and view all the answers

Study Notes

Official Gazette Notice

Nigeria's Official Gazette, Volume 109, Number 90, dated May 13, 2022, contains a supplement.
The supplement includes the Money Laundering (Prevention and Prohibition) Act, 2022.
The Act is Act No. 14.
Act spans pages A465-488 of the Gazette.

Money Laundering (Prevention and Prohibition) Act, 2022

Objectives:
- Provide a legal and institutional framework to prevent, prohibit, detect, prosecute, and punish money laundering and related offenses in Nigeria.
- Strengthen existing systems for combating money laundering and related offenses.
- Prohibit money laundering.
- Expand the scope of money laundering offenses and provide appropriate penalties.
- Establish a Special Control Unit Against Money Laundering within the Economic and Financial Crimes Commission.
Part II - Prohibition of Money Laundering:
- Limits cash payments to ₦5,000,000 (individuals) or ₦10,000,000 (corporations).
- Mandates reporting of international transfers exceeding US$10,000 or equivalent.
- Requires declaration for cash transportation exceeding US$10,000 or equivalent.
- Details duties of financial institutions and designated non-financial businesses and professions regarding customer identification, transaction surveillance, and reporting suspicious activities.
Part III - Special Control Unit Against Money Laundering:
- Establishes the Special Control Unit Against Money Laundering (SCUML) within the Economic and Financial Crimes Commission.
- Outlines SCUML functions, including registration of designated non-financial businesses, monitoring, enforcement, and database maintenance.
Part IV - Offenses and Penalties:
- Defines offenses related to money laundering.
- Outlines criminal and administrative penalties for violations, including fines and/or imprisonment.
  - Specifies penalties for conspiracy, aiding, and abetting.
  - Outlines liabilities for bodies corporate.
Part V - Miscellaneous Provisions:
- Addresses jurisdiction, power to demand and obtain records, obstruction of authorized officers, periodic reporting, and administrative penalties.
- Addresses the retention of proceeds from an unlawful act.
- Explains conspiracy, aiding, and abetting.
- Details liability for bodies corporate.
Important Sections: Includes sections on suspicious transaction reporting, preservation of records, internal procedures, mandatory disclosure, and more.
Definitions: Provides key definitions for terms like "financial institution," "politically exposed persons (PEPs)," "proceeds," "transaction," etc.

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Description

Explore the key objectives and provisions of Nigeria's Money Laundering (Prevention and Prohibition) Act of 2022. This quiz covers the legal framework established to combat money laundering, including prohibitions, penalties, and the establishment of a special control unit. Test your knowledge on this vital legislation designed to strengthen Nigeria's fight against financial crimes.