Overview of the Legal Foundation in Combating Financing of Terrorism (CFT) in Nigeria

Abstract

Substantial progress has been achieved since 1999 in understanding the phenomenon of terrorism financing and in articulating and implementing the measures necessary to address it. Terrorism financing incorporates the distinct activities of fund-raising, storing and concealing funds, using funds to sustain terrorist organizations and infrastructure, and transferring funds to support or carry out specific terrorist attacks. Funds used to support terrorism may be generated through legal or illegal means, and legitimate humanitarian or business organizations may be used unwittingly or knowingly as a channel for financial or other logistical support to terrorism. Financial transactions can yield valuable intelligence that may be unavailable from other sources. Yet, detecting illicit financial activity, including terrorism financing, is difficult in the formal financial system and even more difficult outside of it. Targeted financial sanctions (including, in particular, the freezing of assets) against persons and entities suspected of providing financial support to terrorism have proved effective in many jurisdictions, but they need to be balanced with the need to track terrorist funds movements to gather intelligence on the scope of the terrorist network. Furthermore, combating the financing of terrorism (CFT) measures have raised legal, institutional, political and human rights issues that are not fully resolved. This is perhaps best illustrated by recent court rulings in some jurisdictions that have called into question the procedural safeguards in the designation of persons for financial sanctions. Finding solutions to these issues remains central to maintaining the effectiveness of the system in the long run. Moreover, the New York attacks of 9/11 triggered the global unification in combating the financing of terrorism in theory, but filling the gap between rhetoric and reality is of crucial importance. Intrinsically, to commit a terrorist attack — even a large-scale one — does not require a large amount of funds. For instance the attacks of 9/11 cost Al-Qaeda somewhere in the range of $400,000 to $500,000. Due to their relatively low operational cost, the financial aspects of terrorism cannot be the sole focus to stop the perpetration of future acts of terrorism. However, limiting the resources available to terrorist groups by effective financial control may prevent some attacks from taking place; stopping the transfer of even small amounts of money may save lives, or at least can reduce the possible impact of attacks which cannot be prevented. Indeed, besides the operational costs terrorist groups need funds for “planning, recruitment, procurement, preparation, delivery of materials, communications, persuasion, propaganda, incitement, infrastructure of safe houses/sleeper cells, reconnaissance of targets, and assault on targets”. Aim and Objectives This paper aims at realizing the following objectives: - 1. To examine the what, why and how of combating terrorism financing; 2. To provide an overview of the Countering of Financing of Terrorism (CFT) liability regime in Nigeria; and, 3. To conclude with the way forward for a successful legal regime in CFT.