TICKER: “Cash-based economy reason for fraud, terrorism in Nigeria” – EFCC

The Economic and Financial Crimes Commission (EFCC) on Sunday in Abuja, blamed the nation’s vulnerability to fraud, terrorism and crime on its operation of a cash-based economy.

Speaking in an interview with  Secretary to the commission, Mr. Emmanuel Akomaye, said that the ease of cash flow occasioned by the cash-based economy made the nation so vulnerable.

He said that because of the cash-based economy, it was very difficult to track money as people carried huge sums of money in cash and did whatever business they liked without being tracked.

Akomaye said that if huge transactions were made to go through the financial institutions, they could be easily tracked and as such the nation’s vulnerability to such crimes would be reduced.

“We are really highly vulnerable and one of the key reasons is this; we are a cash-based economy and that entails that it is difficult to track money.

“Elsewhere, every transaction goes through a financial institution; you can hardly go to some countries and bring out 5000 dollars to make a transaction.

“It necessarily would pass through a financial institution, but here because we are substantially cash-based, it therefore means that it’s a huge challenge to track money as you well know that we carry huge cash here and it’s becoming a challenge.

“Even the terror problem that we currently have in the country, one of the challenges is to determine: how are these people funded? Some of the operations are very sophisticated.

“You can conjecture that the level of their sophistication and operation necessarily means that they are properly funded. I mean it’s not a poor man that drives a jeep of N5 million and blows it up.

“Definitely that is not a poor man, even if the suicide bomber is a poor man, the person who funded him must be a rich man and these funding comes in very complex and complicated variance.

“It could be trade-based; sometimes the money is meant for legitimate things, but it ends up in criminal activity.

“So to the extent that we are operating a cash-based economy and monies move so freely in cash in huge sums, it’s a challenge.’’

Akomaye said that the ease of cash flow had also made the nation vulnerable to drugs trafficking in the sense that drugs could pass through the country and payments made in cash as no one could easily track such cash payments.

He said that such vulnerability had also exposed the Nigerian population to illicit drugs saying that although Nigeria was a trans-shipment nation, some of the drugs still stayed back and were consumed locally.

“You also know that we have become a very significant trans-shipment route for drug trafficking and any country with that type of situation means that laundering activities will necessarily take place.

“Because when the drugs pass through here, it means that there is a syndicate either sitting locally or elsewhere that is networking with those who are doing the trans-shipment.

“Of course we cannot run away from the fact that even as we are still largely a trans-shipment point, some of it remains and when it remains, it is consumed by Nigerians.’’

Akomaye said that because the syndicates that ran drugs business could afford to do business with huge cash, they invested the dirty cash in some other legitimate businesses where it could no longer be connected to drugs.

“People who are involved in that trade try to make that business legitimate because the proceeds from the drugs are invested into businesses that look legitimate to make sure that it is clean.

“That is the whole process of laundering; to make dirty money look clean. We are highly vulnerable and again you know that our border points are so porous; we have a very large border line.’’

Vanguard Newspapers

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