NBA Wins Suit Challenging Enforcement of Some Aspects of the provisions of the money Laundering Act 2011
Posted: 26/Dec/2014


The suit was instituted before the Federal High Court in Abuja against the Attorney-General of the Federation and the Central Bank of Nigeria.
Justice Gabriel Kolawole in his judgment declared as invalid, unconstitutional and illegal the directive by the Special Control Unit against Money Laundering that lawyers should report to it certain transactions relating to their clients.

The directive was said to be hinged on the provisions of Section 5 of the Money Laundering (Prohibition) Act 2011.
The defendants in the suit are the Attorney-General of the Federation and the Central Bank of Nigeria.

The court held its in judgment that sections 5 and 25 of the MLA sought to impose sanctions on legal practitioners, who flouted the provisions contrary to the provisions of the Legal Practitioners Act, the Rules of Professional Conduct for Legal Practitioners, and Section 192 of the Evidence Act.
In an originating summons dated March 15, 2013, the plaintiff had asked the court to delete legal practitioners from the definition of Designated Non-Financial Institutions as contained in Section 25 MLA.
The plaintiff had also sought an order of perpetual injunction restraining the CBN from seeking to implement its circular reference FPR/CIR/GEN/VOL.1/028 dated August 2, 2012 in relation to legal practitioners.

It had also sought an order of perpetual injunction restraining the Federal Government, acting through Special Control Unit against Money Laundering, the National Financial Intelligence Unit, the EFCC or otherwise howsoever from seeking to enforce the provisions of Section 5 of the MLA in relation to legal practitioners.

Justice Kolawole agreed with the NBA that the SCUML was not a juristic person, being the creation of the Ministry of Trade and Commerce.
He added that even the Ministry of Trade and Commerce was also not a body known to law, adding that the Federal Executive Council could not by a resolution confer on SCUML a juristic personality.

He noted that there was no connection between the SCUML and legal practitioners, adding that it was improper for the SCUML to seek to exercise oversight powers over the plaintiffs.
He further held that even if any oversight powers were to be conferred on any ministry, it ought to have been the Ministry of Justice.
Justice Kolawole observed that the sanctions sought to be imposed on lawyers had already made provisions for the manner in which a legal practitioner could be disciplined where his conduct fell below the prescribed standards of the rules guiding the profession.

The court held that since the Minister of Trade and Commerce neither issued the Call to Bar certificate nor entered the name of any legal practitioner in the Roll, he had no right to disqualify any legal practitioner.
He also held that legal practitioners could not be categorised “traders” because they never had “customers.”

The disputed Section 5 (1) of the MLA 2011 had read, “A Designated Non-Financial Institution whose business involves the one of cash transaction shall (b) prior to any transaction involving a sum exceeding US$1,000 or its equivalent, identify the customer by requiring him to fill a standard data form and present his international passport, driving licence, national identity card or such other document bearing his photograph as may be prescribed by the ministry.”

Section 5(1)(c) directs all such DNFIs to “record all transactions under this section in chronological order, indicating each customers surname, forenames and address in a register numbered and forward to the ministry.”
The Central Bank of Nigeria had also in its Circular No. FPR/CIR/GEN/VOL.1/028 of 2nd August, 2012, classified legal practitioners as DNFIs in line with the MLA.

The SCUML is an agency currently under the Federal Ministry of Trade and Investment with operational linkages to the Economic and Financial Crimes Commission.

The defendants had argued that the objective of the MLA and the SCUML was not to monitor the legal practitioner but to monitor their clients who might have the potential to commit crimes.