CBN STEPS UP MONITORING OF TERRORISM FINANCING RISKS

The Central Bank of Nigeria has elevated terrorism financing supervision to a current regulatory priority as part of efforts to prevent the country’s financial system from being exploited by criminal and terrorist networks. The apex bank said the heightened attention would focus on strengthening financial institutions’ controls and ensuring compliance with existing anti-money laundering and counter-terrorism financing requirements.

Under the new supervisory focus, financial institutions will face closer scrutiny in areas including terrorism financing risk management, transaction monitoring, targeted financial sanctions and the reporting of suspicious transactions. The CBN said these measures are designed to help institutions identify potentially illicit financial activities and take appropriate action in line with regulatory requirements.

The bank explained that its supervision would continue to follow a risk-based approach, combining on-site examinations with off-site engagements involving regulated financial institutions. Through these activities, the CBN intends to assess the effectiveness of existing controls and ensure that banks and other supervised entities are meeting their legal obligations to detect and prevent terrorism-related financial flows.

The initiative is also linked to Nigeria’s broader efforts to strengthen domestic and international cooperation against terrorism financing and proliferation financing. The CBN said maintaining a strong financial integrity framework is essential to protecting the stability of the financial sector and preventing illicit actors from exploiting legitimate financial channels.

The apex bank added that additional supervisory engagements would be conducted where necessary to support effective implementation of the priority areas. The move is expected to place greater responsibility on financial institutions to maintain effective monitoring systems, identify suspicious transactions promptly and comply with sanctions and reporting obligations relating to terrorism financing.