ORGANISED CRIMES and the LAW- A Comparative Study of Combating Money Laundering in Nigeria, India &...

7/31/2019 ORGANISED CRIMES and the LAW- A Comparative Study of Combating Money Laundering in Nigeria, India & Germ

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money laundering that the proceeds aresought to be disguised to enable theperpetrators enjoy these profits without legaljeopardy. These underlying offences areknown as predicate offences. According to

the United Nations Office on Drugs andCrime, a predicate offence is ...the criminalactivity from which the proceeds of thecrime are derived, with money launderingbeing the derivative crime.

7

Different countries take different approacheswhen legislating on predicate offences. Onthe one hand there are those that explicitlylist specific criminal activities as predicateoffences. One major defect with such

approach is that it limits the scope of illegalactivities that could precipitate moneylaundering, thus creating an avoidableloophole for accused persons to escapejustice.8 On the other hand, there arecountries that criminalise laundering ofproceeds obtained from any criminal actwhatsoever.

9

2.1.1 Nigeria

The Nigerian AML Regime is largely

governed by three statutes namely; theMoney Laundering Prohibition(Amendment) Act (hereafter MLPAA),

10the

Advanced Fee Fraud and Other FraudRelated Offences Act11 and the 2004Economic and Financial Crimes

7UNODC, Predicate Offence in UNDOC,MoneyLaundering Terms Dictionary (2005). Accessed on 30September 2009, athttp://www.babylon.com/definition/Predicate_offence/English8A. Adekunle, Seizure of Proceeds of Criminal Activity:

Trends in Recent Financial Crimes Legislation in Nigeriain Modern Practice Journal of Finance and Investment

Law (1999) Vol. 3, No. 2, 250 at 262.9 R. Ezeani,Impact of International and Domestic Laws on

Money Laundering Activities in the ECOWAS: A LegalPerspective (2005) 3, accessed on 30 September 2009 atwww.aeandelegal.com/dynamicdata/flash/MONEY%20LAUNDERING%20in%20Ecowas%20reviewed.pdf10 Of March 2004 amending the Money Laundering(Prohibition) Act No 7 of 2003 (hereinafter MLPA)11 No 3 of 1995.

Commission (Establishment) Act (hereafter2004 EFCCEA).12 Under this AML Regime,predicate offences include any criminalactivity such as common theft.

13

The author opines that this approach is goodfor Nigeria as it keeps her in tandem withinternational trends of widening thedefinition and scope of money laundering.Secondly, it a positive approach as it hits atthe laundering of the proceeds of any crimeso as to principally cripple its financing andlogistic support which is the main aim ofsuch international instruments as the UnitedNations Convention on TransnationalCrimes and successful national legislation in

countries like the United Kingdom.

14

2.1.2 India

India is a bit similar to Nigeria in that thefundamental Act itself, 2002 Prevention ofMoney Laundering Act (hereinafter 2002PMLA)15 takes a general definition of anycrime and does not restrict itself to specific

predicate offences; yet, other statutessupplement it by explicitly identifyingspecific activities that constitute predicate

offences. They include terrorist activities asper the 1967 Unlawful Activities(Prevention) Act (hereafter UAPA),16 andillicit traffic in drug and psychotropicsubstances as per the 1985 Narcotic Drugsand Psychotropic Substances Act(hereinafter 1985 NDPSA).

This approach is commendable because itcasts the net wide enough to capture allillicit activities, and at the same timeprovides itself with checks and balances notto lose focus. Such approach could havebeen prone to the criticism for ambiguity

12 Repealing the December 2002 edition13 R. Ezeani, op cit, 3.14 Proceeds of Crimes Act No c. 29 of 2002.15 (28 November 2002), Section 316 Section 21
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and unpredictability in the law had it notbeen for the supplementary statutes.

2.1.3 GermanyThe German AML Regime is premised on

Section 261 of the Criminal Code (MoneyLaundering; Disguising of Illegal Assets). Itcategorically identifies only 4 specific typesof crimes as the money laundering predicateoffences namely;

17i) all major crimes

(Verbrechen), i.e. all offences carrying aminimum of one year's imprisonment suchas human trafficking; ii) all less seriouscrimes (Vergehen) of illegal trade innarcotics and precursors;18 iii) certainVergehen involving property, fraud,

document and corruption offencescommitted on a commercial basis by amember of a gang formed for recurrentcommission of such offences; and iv) allVergehen committed by a member of acriminal association within the meaning ofSection 129 of the Criminal Code such asgambling.

The author is of the opinion that thisapproach of clearly listing which exact

criminal activities constitute predicateoffences has both pros and cons. The majoradvantage is that it enhances predictabilityin the law by eliminating ambiguity anduncertainty, while the main disadvantage isthat the scope of the AML Regime isrelatively narrowed resulting in someprobable money laundering activities gounpunished. However, repeated nationalsurveys have shown that though the numbercharges generated on these predicate

17The European Commission, Money Laundering: How toImprove EU Rules for Prevention in Europa InternalMarket, Single Market News (October 1998) SpecialFeature No. 14, 2. Copies of the report are available via theDG XV's website:http://ec.europa.eu/dg15accessed on 28 September 2009.18 Sentence No 1 of Section 29(1), the Narcotics Act(Betubungsmittelgesetz) or Section 29(1) of theCommodities Control Act (Grundstoffber-wachungsgesetz)

offences has been relatively small (average20 annually), the rate of convictions hasbeen almost 100%.

19Therefore, the author is

of the view that Germanys approach onpredicate offences is the best of the three

because prosecution of economic crimes isvery expensive; therefore, it must be aboutsuccessful prosecutions and not so manycases that end unsuccessfully.

2.2 Suspicious Transaction Reporting and

Other Reporting(s)

By norm and practice, the CommercialCrimes Units of each country areempowered to receive suspicious transactionreports (STRs) and other types of reports on

behalf of the prosecution authorities. Inconformity with their respective legalsystems, different countries define STRsdifferently. Some adopt a wider definitionthan others. Consequently, for those withnarrow definitions, the obligation togenerate STRs is circumscribed as thosereports only arises if the offence suspected isa money laundering predicate offence. Thesame applies to the proscription of banksecrecy rules and lawyer/clientconfidentiality. The rules only fall away ifmoney laundering predicate offence isinvolved.

2.2.1 Nigeria

Due to its wider view of money launderingto cover laundering of proceeds of allcrimes, Nigerias AML Regime has widenedthe latitude of matters to be reported. InNigeria every suspicious transaction must bereported regardless of whether it involveslaundering of proceeds of a crime ornot.20Incidental to this, the Nigerian AMLRegime has four philosophies underlying its

19 Per German Criminologist, Michael Kilchling quoted byP. Reuter and E. M. Truman, Combating Predicate CrimesInvolved in Money Laundering in Chasing Dirty Money:The Fight Against Money Laundering (2004) IIEPublications, Washington D.C, 105, at 118.20 See R. Ezeani, op cit, 9.
http://ec.europa.eu/dg15http://ec.europa.eu/dg15http://ec.europa.eu/dg15


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reporting system.21 Firstly, the law createscontrol mechanisms to discourage hugefinancial transactions being conducted withthe use of cash. Section 1(1) of PLMAAstipulates that no person or body corporate

shall make or accept cash payment of a sumexceeding N500, 000 or its equivalent in thecase of individuals, while in the case of acorporate body the amount is limited to N2,000,000 unless the transaction is donethrough a financial institution. In doing so,financial institutions act as governmentagents for monitoring and regulatingtransactions involving huge sums.

Secondly, and further to the above, PLMAA

section 2(1) directs financial institutions todisclose any financial transaction exceedinga particular sum of money. It stipulates thus:A transfer to or from a foreign country offunds or securities of a sum exceedingUS$10,000 or its equivalent shall bereported to the Central Bank of Nigeria. Itgoes further to provide that a report madepursuant to the above provision shallindicate the nature and amount of thetransfer, the names and addresses of thesender and receiver of the funds orsecurities.22 The author submits that thisprovision is vital in the prevention of moneylaundering as perpetrators feel deterred fromusing of such financial institutions formoney laundering, since publicity or the fearof publicity would expose their nefariousactivities.

Thirdly, in a bid to curb money laundering,like other comparator countries, Nigeriaobligates financial institutions to enforce theKnow-Your Customer (hereinafter KYC)requirements. This requires all financialinstitutions (including Bureaux de Change)to know the true identity of their customersand report to the relevant authorities any

21Cf: Okogbule, op cit, at 453.22MLPAA, Section 2(2)

suspicious transactions concerning thoseclients accounts.

23 Financial institutions aretherefore expected to be vigilant in reportingall unusual and complex transactionsnotwithstanding any oath, contractual

obligations, or arrangements with thecustomer and such reporters are immunefrom civil and criminal liability for thosereports done in good faith though no offenceof money laundering was actuallycommitted and they did not know preciselythe nature of the underlying criminalactivity.24

Fourthly, the PMLA imposes an obligationof record keeping imposed on such financial

institutions. In Nigeria records oftransactions and customer identity are to bekept for 10 years, and any banker or personengaged in financial activities, who destroysrecords before the end of the prescribedstatutory period is guilty of an offence.

25In

the authors considered opinion, this is

another area where the Nigerian AMLRegime has taken a huge vital strides as ithas even gone beyond FATFRecommendation that Banks and Financialinstitutions maintain records of their clientsidentification and transactions for up to 5years during the operational life of theconcerned account(s).

2.2.2 India

Section 12, 2002 PMLA and Rule 8 ofNotification No. 9 of 2005 impose anobligation on banking companies, financialinstitutions and intermediaries of thesecurities market to verify the identity ofclients, maintain records and furnishinformation to the authorities wheneverthere are suspicious transactions.26

23 Ezeani, op cit, 424Ibid, 625Ibid, 426 FIU-IND, Banking Company: Suspicious TransactionReport in Electronic File Structure, 2, available at


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Suspicious transactions entail anytransactions which a reasonable personacting in good faith would conclude thatthey; gives rise to a reasonable ground tobelieve that they involve proceeds of crime;

or appear to be made in circumstances ofunusual or unjustified complexity; or appearto have no economic rationale or bona fidepurpose.

The author submits, therefore, that withrespect the reporting of suspicioustransactions, India has the most effectiveand comprehensive laws with very clear anddetailed broad categories of reasons forsuspicion.

2.2.3 Germany

The cornerstone of the German AMLRegime is the obligation on credit andfinancial institutions (including 'bureaux dechange') to require identification of all theircustomers when beginning a businessrelationship (particularly the opening of anaccount or offering safe-deposit facilities),when a single transaction or linkedtransactions exceed 15,000 or when theysuspect laundering.27 However, Germanlegislation does not establish a specificsanction for the failure to report suspicionsof money laundering, though it providesadministrative sanctions (a fine up to50,000) for informing the customer or aparty other than a public authority of thefiling of a report and for other types ofadministrative offences.

If the financial institution does not report

probable suspicions it becomes liable for anoffence of negligent money laundering forwhich penalty is up to 2 years ofimprisonment or a fine, and an offence of

www.pfiuindia.gov.indownloadsSTRBank.pdfand accessedon 3 October 200927 The European Commission, op cit.

obstruction of punishment, for which thepenalty is up to 5 years of imprisonment or afine.

28Though some authors have argued

that in practice, administrative sanctions areavailable for serious cases of non-

reporting,

29

the author contends thatGermany should consider amending itslegislation to specifically impose a sanctionfor failure to report suspicious transactions.

2.3.0 Obligations on Non-Financial

Businesses and ProfessionsCombating money laundering and indeedany other white collar/organised crimedemands the crossing out of the financialtrading businesses to other businesses and

professions as evidenced in the UnitedNations Convention against TransnationalOrganized Crime which requires memberStates to establish:

...a comprehensive domesticregulatory and supervisory regime forbanks and non-bank financialinstitutions and, where appropriate,other bodies particularly susceptible tomoney-laundering, within itscompetence, in order to deter anddetect all forms of money-laundering....30

Furthermore, FATF Recommendationsrequire member states to empower theircompetent authorities to extend theirmandate to obtain financial intelligencefrom non- financial institutions and otherprofessions.31

28 J. A. A. Mndez et al, Germany: Report on theObservance of Standards and Codes- FATF

Recommendations for Anti-Money Laundering andCombating the Financing of Terrorism (July 2004) IMFCountry Report No. 04/213, IMF Publication Services,Washington DC, 4, para 18.29Ibid.30 The Palermo Convention, 2000, Article 7.31 Cf: L. Fernandez, Investigating Money Laundering 2(September 2009) Lecture Materials: The Law Related to

Anti- Money Laundering and Organised Crime, MastersDegree Program, South African- German Centre ofExcellence, UWC, 2.


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2.3.1 Nigeria

The 2007 US DoS Report32 notes that undertheMLPAA and the 1995 Foreign Exchange(Monitoring and Miscellaneous Provisions)Act,Nigerias AML Regime extends to non-

financial businesses and professions such ashotels, legal practitioners, and otherbusinesses designated by the FederalMinistry of Commerce. The laws alsorequire the designated non-financialinstitutions to furnish the authorities withdetails of their financial transactions,especially STRs, and reports involving thetransfer of funds or securities exceeding$10,000 to or from foreign countries. Thereport, however, noted that the oversight of

compliance by the Ministry of Commercehas not been rigorous or effective, hence,recommended further strengthening of thesupervision of non- financial institutions byremoving the oversight function from theMinistry of Commerce.

33

The author is of the view that PLMAASection 16 impliedly imposes an obligationon all persons (including non- financialbusiness entities) not to assist, condone, or

acquiesce the commission of moneylaundering. If they do not do so, they riskbeing held complicity to the offence with astiffer penalty than that for the laundererhimself.

34Perhaps the rationale for such

disparities is to deter non- financialbusinesses and professions like lawyersfrom rendering the much needed expertise tothe launderers for purposes of perpetratingthe crime as enunciated by the GermanyFederal Constitutional Court.35 Moreover, it

32 Cited in Financial Standards Foundation, Nigeria: Anti-Money Laundering/Combating Terrorist FinancingStandard (2008) available at www.eStandardsForum.orgaccessed on 3 October 2009, 1, para 3.33Ibid.34PLMAA, Section 14(1)35 See A. Bussenius, Money Laundering by DefenceCounsel: The Decision of the Federal Constitutional Court

is equally an offence under for non-financial institutions or professions toconspire with, aid, abet or counsel anyperson to launder money,

36punishable with

compulsory winding up in serious cases.37

The author opines that such provisions aregood deterrent measures in the fight againstfinancial crimes and conform to well-knownprinciples governing corporate criminalliability.38 However, for developingcountries like Nigeria, such penalty is tooharsh as one of the social implications ofsuch a winding up would be unemployment.In a country where the rate ofunemployment is already very high, such

measures are likely to aggravate socio-economic problems instead of remedyingthe same mischief.

39

2.3.2 India

The 2002 PMLA makes it obligatory forfinancial institutions and their intermediaries(who may be non- financial businesses orprofession) to maintain a record of allprobable suspicious transactions or series oftransactions, the nature and value of which

is prescribed by the Central Government.40

It is also a mandatory requisite for theseinstitutions to validate and preserve therecords of identity of all its clients in theprescribed manner for a period of five yearsfrom the date of cessation of transactionsbetween them; and be ready to tender suchrecords within a prescribed time and manneronce called upon by the designatedauthorities.

41

in Germany Law Journal (1 September 2004) vol. 5, No. 9,490.36PLMAA Section 17 (a)37Ibid, Section 18(1) (2)38 L.C.B. Gower et al, Gowers Principles of ModernCompany Law (1979), 4th ed., Stevens & Sons, London,12639Cf: Okogbule, op cit, 454.40Section 1141 See Dadoo, op citfor a lengthy discussion of section 11.


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Further, when read together, Sections 8Aand 38 of the 1985 NDPSA also criminalisethe concealing or disguising of the truenature, source, location and disposition ofany property, not necessarily by financial

institutions alone, with the knowledge thatsuch property is derived from an offence.These provisions actually apply theinternational principle of dual criminality inthat it prohibits the aforementioned vices ascriminalised in India or any corresponding

law of any other country. The authorsubmits that this is a positive feature of theIndian ant- money laundering regime as faras non- financial businesses or professionsare concerned as the law essentially imposes

obligations on the non- financial institutionseven for breaches committed outside abroad.

The author is of the view that Indias AML

Regime on non- financial businesses andprofessions is sufficient and favourable. Forexample, on the footing of the 1967 UAPAsalone so many companies have been woundup with their directors imprisoned in certaincases for non-compliance with its Sections21 and 24. These sections make apunishable offence the holding of proceedsderived from terrorist activities, and imposea duty on Directors of financial and non-financial companies compulsorily transfershares of all members suspected of terroristactivities into the name of the government,respectively.42

In fact, India is known for its record ofprosecuting directors of both financial andnon- financial businesses for economiccrimes as evidenced by a long list of casessuch as Standard Chartered Bank v.Directorate of Enforcement;43 State ofMaharashtra v. Syndicate Transport Co. (P)Ltd;44 M.C.D. v. J.B. Bottling Co. Pvt. Ltd;45

42Cf: Muralidhar and Deva, op cit, 9.43(2005) 4 SCC 530 or AIR 2005 SC 262244 AIR 1964 Bom 195.

and Emperor v. Dhanraj Mills Ltd, interalia,46where the obligations on non-financial businesses have been re-echoed.

2.3.3 Germany

In Germany, the law concerning non-financial institutions is entrenched in thenew requirements detailed in theGeldwschegesetz (hereinafter GwG)47and in line with the second EC MoneyLaundering Directive which obligateadditional professions outside financialinstitutions (in particular, lawyers, estateagents, notaries, tax consultants andaccountants) to the identification andreporting requirements. In practice, the

provision is almost obsolete as almostnegligible reports are made annually; in2002 only three such reports were made.48

The author opines that this may beattributable to the fact that prosecuting legalentities is problematic because traditionallyonly natural persons are subject toprosecution under German criminal law.Therefore, officers of a company who areresponsible for acts done in the name of thecompany are sought to be made personallyliable for acts which result in criminal actionbeing taken against the Company; and thisonly happens in very special circumstanceswhich do not include money laundering sofar.49 With reference to professions likelawyers, the situation is still problematicbecause the threshold to impugn the blameis too high. A lawyer is only under duty toreport if he actually knows, and not onlysuspecting, that his/her client is involved inmoney laundering that lawyer.

50

45 1975 Cri LJ 1148 (Del) (FB)46 AIR 1943 Bom 182.47 Money Laundering Act as amended on 8 August 2002.48 Mndez et al,op cit, 8, para 4149 R. Klinger and A. Sebok, Survey Response, Laws ofGermany in Fafo, Commerce, Crime and Conflict: ASurvey of Sixteen Jurisdictions (2006) Fafo AIS, Germany,8- 10.50 Bussenius, op cit, 490


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2.4.0 Financial Intelligence Gathering

Financial intelligence gathering has beendefined as: investigations in which onbehalf of law enforcement- financialexpertise is used in order to gather, check,

refine, process and analyse (financial)information.51 Statements from informers,as well as publicly accessible informationmay be used by the Financial IntelligenceUnits (hereinafter FIUs). The FATFRecommendations which leave it up to theindividual countries decide the kind of FIUsthat they consider appropriate.52 As suchsome countries allow their FIUs to acceptinformation obtained through under-coveragents sting operations

53 while others do

not.

Ordinarily, FIUs are the central authoritiesmandated with receiving of STRs and otherreports though it is acceptable in somecountries to have various government units,permanent or temporary investigativegroups/wings helping the FIUs.

54

2.4.1 Nigeria

Upon promulgation of the 1995 MLD,

Nigeria established a Money LaunderingSurveillance Unit in the Central Bank ofNigeria55 which was later replaced with amuch more effective one called theEconomic and Financial CrimesCommission in 2002 tasked with thegathering of financial intelligence, interalia.

56The Commission has power to

conduct investigation as to whether anyperson has committed an economic orfinancial crime. It also has power to conductinvestigations into the properties of any

51 M. Pfeiffer Financial Investigations and CriminalPolicy (1988) 2 Journal of Money Laundering Control,Washington D.C, 33 at 3452Cf: Fernandez, op cit, 3.53Ibid, 954

FATF, Recommendation 27. See also Fernandez, op cit, 2.55Kingwai op cit, 25556 Economic and Financial Crimes EnforcementCommission Act of 2002, Preamble.

person if it appears to it that the extent of theproperties and life style of the person are notjustified by his official income. In theexercise of these powers the Commission isunder the control of the Attorney General of

the Federation who may from time to timegive directions to the Commission. The lawmakes it mandatory for any officer of a bankor other financial institution to takereasonable care to comply with theCommission57 as failure to do so is anoffence punishable by imprisonment.58

2.4.2 India

The Government of India set up FinancialIntelligence Unit (hereinafter referred to as

FIU-IND) on 18 November 2004 as anindependent body to report directly to theEconomic Intelligence Council (EIC)headed by the Finance Minister.59 The FIU-IND operates as a repository for (STRs)which are then forwarded to a departmentwithin the Ministry of Financeinvestigations and decision on whether toprosecute or not.

60This is a unique feature

about Indias AML in this context as it

delegatespowers to subjective agencies touse their discretion whether or not toprosecute. In fact there are a number ofother national agencies responsible foroverseeing specific pieces of legislationgoverning economic crimes with too widelatitudes of discretion; such as theCommissioner of Customs, and theNarcotics Control Bureau, inter alia. Theflaw is that such wings not under obligation

57Ibid.58 Ezeani, op cit, 8-9

59 FIU-IND, op cit60 ASIA/PACIFIC GROUP ON MONEY LAUNDERING(APG), India: Anti- Money Laundering and Combatingthe Financing of Terrorism in 1st

APG Mutual Evaluationagainst the FATF 40 Recommendations and 9 Special

Recommendations (13 July 2005), para 10,www.apgml.orgdocumentsdocs8India%20Mutual%20Evaluation%20Executive%20Summary.pdf accessed on 3October 2009. See also T. Jyoti, Crime and Money

Laundering- The Indian Perspective (2004) OxfordUniversity Press, London, 9.


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to report suspicious transactions to otherrelevant authorities for effective gathering offinancial intelligence.

61

2.4.3 Germany

The German FIU was only established on 15August 2002 and joined the Egmont Groupin June 2003. It was formed as a distinctentity within the BKA which provides for aspecific police character of the FIU. To

ensure a full range of expertise, the FIU hasopted for a multi-disciplinary approach andhas recruited consultants from the bankingsector and a firm of auditors. The FIU isrequired to (1) collect and analyse STRsfiled, in particular checking against data

stored by other offices, and (2) report to thefederal and Land prosecuting authoritieswithout delay information that concernsthem as well as any connections betweencriminal acts ascertained. Apart from thesestandard tasks, within the FIU there are

specialisations in the areas of dataprocessing, operational/strategic analysisand policy-making. The FIU does haveaccess to numerous sources of information,whether financial, administrative, or lawenforcement to enable it to adequatelyundertake its responsibilities.62

For purposes of financial intelligencegathering, a search and seizure warrant maybe issued authorizing an appropriate person(a) to enter and search premises specified inthe application for the warrant; and (b) toseize and retain any material found therewhich is likely to be of substantial value

61 I. Dettmann-Busch (Moderator) et al,Capacity Buildingfor FIUs: A Regional Exchange for Practitioners onFinancial Analysis Techniques and Global AML/CFTstandards (4 - 8 August 2008), FIU (Financial IntelligenceUnits) Workshop on Financial Analysis Techniques,organized by InWEnt and Capacity Building International(Germany) in collaboration with the Asia/Pacific Group onMoney Laundering (APG) and the Office of TechnicalAssistance (OTA) of the U.S. Department of the Treasury,New Delhi, 2.62 Dettmann-Busch (Moderator), op cit

(whether or not by itself) to the investigationfor the purposes of which the application ismade.

63Searches and seizures are, however,

subject to the constitutional safeguard of theright to privacy which may limit, time,

space, and nature of article to be seized(scope).64

The prosecutors are allowed to take drasticmeasures against a lawyer who is suspectedof having committed money laundering byaccepting dirty money from a client. In thissituation the StPO (Criminal ProcedureCode) can justify not only searches andseizures but also the surveillance of (tapinginto) telecommunication lines in counsels

office.

65

The author submits that suchunique empowerment on the part ofprosecutors has contributed to the strengthand effectiveness of the German FIU.

The major weakness that critics havehighlighted about Germanys financialintelligence gathering is that for instance,there is no general provision in Germany inrelation to feedback, especially between theFIU and the institutions filing the STRs

contrary to the FATF 40 Recommendations

66

3.0 Conclusions

3.1 Nigeria

From the foregoing and indeed on a plethoraof literature, it is clear that though adeveloping country, Nigeria has enactedadequate and sufficient legislation to dealwith money laundering. This, coupled withthe apparent political will from the currentgovernment has greatly enhanced the anti-

money laundering regime in Nigeria.Nigeria has continued to constantly reviewand her legislation in line with the trends in

63 Durchsungsbefehl, vide Paras 104 ff German Code ofCriminal Procedure.64 Fernandez, op cit, 8- 965 StPO, Sections 97, 100a, and 102. See also Bussenia, opcit, 2.66 Mndez et al, op cit, 10, table 2.


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money laundering activities. Moreimportantly, Nigeria has significantlyimproved her laws in the area of complianceand prevention resulting in the FATFremoving her from the non-cooperative

countries and territories (NCCT) list in May2006 after having placed her on that list for5 years.67 These are very positive featuresabout Nigerias AML Regime. Unlike

Germany which does not explicitly stipulatespecific sanctions for non- reporting ofsuspicious transactions68, Nigeria has clearlaws on sanctions for not reportingsuspicious transactions. For instance, in theearly 2000 banks like Devcom, Manny Bank& Trust Bank have been charged for non-

compliance with money launderingprovisions; and some car dealers such asCarlink and Alpha Motors, inter alia, havebeen shut down.69

3.2 India

India has adopted the most comprehensiveand elaborative laws in terms of substance,content and procedure but relatively weak interms of enforcement. For instance, thoughthe anti- money laundering Act was onlyenacted in 2002, as early as 1985 India hadalready criminalised the concealing ordisguising of the true nature, source,location and disposition of any propertyderived from illicit activities70 which inessence is money laundering. Secondly,India has a very robust (quick action)responsive approach to legislating on moneylaundering so as to be in tandem withinternational trends and keeping abreast newtechniques being devised and employed by

67 Financial Standards Foundation, op cit, 1.68 Mndez et al,op cit, 10, para 40.69 See back page of The Guardian Newspaper of Friday 30June 2003 quoted in R. Ezeani,Impact of International and

Domestic Laws on Money Laundering Activities in theECOWAS: A Legal Perspective (2005) available atwww.aeandelegal.com/dynamicdata/flash/MONEY%20LAUNDERING%20in%20Ecowas%20reviewed.pdf accessedon 30 September 2009.70 1985 NDPSA, Section 8A

launderers. For instance, the UAPA whichwas enacted in 1967 initially intended topunish unlawful activities of individuals andassociations, has since September 21, 2004,been extensively amended include terrorist

activities as predicate offences of moneylaundering, yet there has not been tangibleenforcement of the same.71

3.3 Germany

The German AML Regime is the mostsuccessful of the three in terms of repressivemeasures as it has proven to be effective andefficiently implemented as evidenced insuccessful prosecutions.72 Germany hasadopted a very comprehensive set of

repressive measures with regard to moneylaundering.73

However, there are a fewdeficiencies that must be addressed in orderfor Germany to comply with some of theFATF standards; such as the absence ofspecific sanctions for not reportingsuspicious transactions. A specific sanctionsregime for non- compliance with theidentification requirements in case ofsuspicious transaction should beincorporated within the legal framework.74

REFERENCES

(A)PRIMARY SOURCESTable of Cases Cited

1. Emperor v. Dhanraj Mills Ltd, AIR1943 Bom 182.

2. M.C.D. v. J.B. Bottling Co. Pvt. Ltd,1975 Cri LJ 1148 (Del) (FB)

3. Standard Chartered Bank v.Directorate of Enforcement, (2005) 4SCC 530 or AIR 2005 SC 2622.

71 Cf: Judge Dr. S.Muralidhar and S. Deva, SurveyResponse, Laws of India in Fafo, Commerce, Crime andConflict: A Survey of Sixteen Jurisdictions (2006) AIS,New Delhi, 9.72 Mndez, op cit, 9, para 4473Ibid, 1-2.74Ibid, 10, table 2.
http://www.aeandelegal.com/dynamicdata/flash/MONEY%20LAUNDERING%20in%20Ecowas%20reviewed.pdfhttp://www.aeandelegal.com/dynamicdata/flash/MONEY%20LAUNDERING%20in%20Ecowas%20reviewed.pdfhttp://www.aeandelegal.com/dynamicdata/flash/MONEY%20LAUNDERING%20in%20Ecowas%20reviewed.pdfhttp://www.aeandelegal.com/dynamicdata/flash/MONEY%20LAUNDERING%20in%20Ecowas%20reviewed.pdfhttp://www.aeandelegal.com/dynamicdata/flash/MONEY%20LAUNDERING%20in%20Ecowas%20reviewed.pdf


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4. State of Maharashtra v. SyndicateTransport Co. (P) Ltd, AIR 1964 Bom195.

List of Conventions

1. United Nations Convention onTransnational Crimes.2. United Nations Office on Drugs andCrime.

List of Official Reports

1. A. Bharti et al, The Economic CrimesIncluding Money Laundering; ItsLegal and Financial Implications in

UNAFEI, Group 2 Resource MaterialSeries No.67, 128th InternationalTraining Course Reports [for India,Japan, Albania, Laos, Vanuatu, and

Bangladesh]. Copy is available withthe author.2. ASIA/PACIFIC GROUP ON MONEY

LAUNDERING (APG), India: Anti-Money Laundering and Combating theFinancing of Terrorism in 1st APGMutual Evaluation Against the FATF40 Recommendations and 9 SpecialRecommendations (13 July 2005), para10, available atwww.apgml.orgdocumentsdocs8India%20Mutual%20Evaluation%20Executive%20Summary.pdfand accessed on 3October 2009.

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(Amendment) Act 1 Of March 2004

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ORGANISED CRIMES and the LAW- A Comparative Study of Combating Money Laundering in Nigeria, India &...

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