CBN issues fresh warning to banks and fintechs over sanctions breach

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The Central Bank of Nigeria (CBN) has issued a directive to banks, payment service banks, and fintech companies, warning them to strengthen their sanctions compliance frameworks or face enforcement actions.

Financial institutions are required to maintain a robust and dynamic sanctions compliance framework that enables them to identify and respond promptly to updates or changes across all applicable sanctions lists. They must also prevent the use of their systems and platforms for transactions involving designated individuals or entities, conduct real-time screening of customers, transactions, and beneficial owners, and file appropriate reports with the Nigerian Financial Intelligence Unit and notify the CBN, where necessary.

For further information, read more details here

“Financial Institutions are required to maintain a robust and dynamic sanctions compliance framework that enables them to Identify and respond promptly to updates or changes across all applicable sanctions lists; Prevent the use of their systems and platforms for transactions involving designated individuals or entities; conduct real-time screening of customers, transactions, and beneficial owners; and file appropriate reports with the Nigerian Financial Intelligence Unit and notify the CBN, where necessary,” the circular read.

The CBN emphasised that “the effectiveness of sanctions compliance programmes must be regularly reviewed and aligned with legal and regulatory requirements and expectations.” Failure to comply may result in enforcement action or regulatory sanctions. The CBN stressed that compliance is not optional and urged financial operators to align with applicable laws and directives to avoid penalties.

This directive comes at a time when global scrutiny over financial crimes is intensifying, particularly around anti-money laundering and counter-terrorism financing regulations. Nigeria, which is working to improve its standing with global watchdogs like the Financial Action Task Force, has been ramping up oversight across the financial sector

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