Nigeria's NPO risk test helps identify terrorism financing vulnerabilities

Nigeria's Economic and Financial Crimes Commission (EFCC) announced that its nationwide terrorism financing risk assessment of Non-profit Organisations (NPOs) has successfully identified a limited number of organizations vulnerable to exploitation by terrorist financiers. The agency stated that this targeted approach ensures the vast majority of legitimate charities and civil society groups are not subjected to unnecessary regulatory burdens.

Speaking at the Third Africa High-Level Civil Society Anti-Money Laundering and Counter-Terrorist Financing (AML/CFT) Conference in Abuja, EFCC Chairman Olanipekun Olukoyede explained that the assessment marked a significant shift. It moved away from broad assumptions about the NPO sector towards a precise, evidence-based understanding of terrorist financing risks. The conference itself brought together various stakeholders, including regulators, financial intelligence units, law enforcement, development partners, and civil society leaders from across Africa, focusing on implementing FATF Recommendation 8.

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The assessment has enabled Nigeria to move beyond broad assumptions and towards a more targeted understanding of terrorist financing vulnerabilities. It has strengthened our ability to identify organisations genuinely at risk of abuse, while ensuring that the overwhelming majority of legitimate non-profit organisations can continue their vital work without unnecessary regulatory burdens.

Olukoyede, represented by Harry Erin, Director of the Special Control Unit Against Money Laundering (SCUML), highlighted the collaborative nature of the assessment. It involved the EFCC, SCUML, the Nigerian Financial Intelligence Unit (NFIU), the Office of the National Security Adviser, the Corporate Affairs Commission (CAC), and civil society organizations. This extensive consultation and technical rigor, coupled with active participation from the non-profit community, allowed Nigeria to pinpoint organizations genuinely at risk while safeguarding the operations of legitimate entities.

"The assessment has enabled Nigeria to move beyond broad assumptions and towards a more targeted understanding of terrorist financing vulnerabilities," Olukoyede stated. He emphasized that FATF Recommendation 8 is not intended to broadly restrict all NPOs but rather to identify and apply proportionate, risk-based measures to those organizations potentially vulnerable to terrorist financing abuse. Civil society organizations were recognized as indispensable partners in delivering essential services like humanitarian aid, education, and healthcare.

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The Financial Action Task Force (FATF) Recommendation 8 was not intended to regulate or restrict all non-profit organisations but requires countries to identify only those organisations that may be vulnerable to terrorist financing abuse and apply proportionate, risk-based measures.