EFCC Warns Nigeria POS Operators: Stop Aiding Fraudsters, Money Laundering

• The EFCC has issued a warning to POS operators in Nigeria against aiding financial crimes like fraud, money laundering, terrorist financing, and ransom payments.
• EFCC Chairman Ola Olukoyede, through his Chief of Staff, highlighted that poor record-keeping and lack of oversight by AMMBAN members hinder investigations.
• The Commission urged AMMBAN to strengthen its monitoring framework, ensure proper transaction records, and provide comprehensive training for its operators nationwide.
• Some POS operators are reportedly directly involved in fraudulent activities, conspiring with and abetting criminals.
• AMMBAN President Oti Obioha acknowledged the need for collaboration and expressed the association's readiness to partner with the EFCC on training and awareness to combat fraud.

The EFCC's stance signals a heightened focus on ensuring compliance within the mobile money sector, particularly concerning the activities of individual agents.

The Economic and Financial Crimes Commission (EFCC) has issued a stern warning to Point of Sale (POS) operators across Nigeria, cautioning them against facilitating financial crimes such as fraud and money laundering. This significant advisory came from EFCC Chairman Ola Olukoyede during a recent courtesy visit by a delegation from the Association of Mobile Money and Bank Agents in Nigeria (AMMBAN) to the Commission’s headquarters. The warning, initially disseminated via the EFCC's X handle on Thursday, underscores growing concerns within the anti-graft agency regarding the misuse of POS terminals.

Speaking through his Chief of Staff, Commander Michael Nzekwe, Chairman Olukoyede highlighted that POS operators have become increasingly implicated in illicit transactions. These include not only money laundering but also terrorist financing and the processing of ransom payments, indicating a critical vulnerability in the financial system. The EFCC's stance signals a heightened focus on ensuring compliance within the mobile money sector, particularly concerning the activities of individual agents.

The EFCC Chairman directly challenged AMMBAN regarding its oversight capabilities, questioning the extent of its impact on members, the provision of training, and the maintenance of accurate records, including members' addresses. Olukoyede, via Nzekwe, emphasized that a significant portion of illicit financial flows, including those related to money laundering, terrorist financing, and ransom demands, are now routed through POS machines. This trend poses substantial challenges for investigators.

Poor transaction record-keeping by operators frequently obstructs investigations, making it difficult to trace funds moved through POS outlets. Olukoyede noted that when operators are questioned, they often lack information about who sent or withdrew money, or even basic transaction details. Furthermore, the EFCC has identified instances where some POS operators are not merely unwitting facilitators but are actively involved in fraudulent activities, conspiring with criminals, providing information, and directly aiding fraudsters.

In light of these findings, the EFCC has urged AMMBAN to significantly strengthen its organizational structure and implement a robust, comprehensive framework for monitoring its members. A key demand is for operators to maintain meticulous financial records for every transaction and to keep accurate, nationwide records of all their agents. This push for improved Nigeria POS operator compliance is critical for combating financial crime.

Chairman Olukoyede also called for increased awareness and training among mobile money agents, recognizing that a lack of understanding of operational rules contributes to vulnerabilities. The Commission expressed its readiness to collaborate with AMMBAN, offering support in areas such as training, awareness creation, and information sharing to bolster anti-money laundering efforts and mitigate the risks of POS fraud.

Responding to the EFCC's concerns, AMMBAN National President Oti Obioha expressed gratitude for the reception and acknowledged the pressing need for closer cooperation between the association and the Commission. Obioha affirmed AMMBAN's commitment to working alongside the EFCC to prevent money laundering and other forms of fraud, recognizing the pivotal role POS operators play at the grassroots level in Nigeria's financial ecosystem.

Obioha highlighted that EFCC investigations frequently involve their members, underscoring the necessity for a formal partnership. He advocated for collaborative training initiatives to educate members on crucial aspects like financial thresholds and the inherent risks associated with their operations. The AMMBAN President reiterated the association's readiness to partner with the EFCC to reduce fraud within the sector, particularly through training and awareness campaigns, as many agents are not fully conversant with the rules governing their activities.

Lawyers and compliance officers advising mobile money operators, fintechs, or financial institutions utilizing POS networks in Nigeria should immediately review their AML/CFT compliance frameworks, agent training, and record-keeping protocols. The EFCC's explicit warning signals increased regulatory scrutiny and potential liability for operators found aiding financial crimes, necessitating proactive measures to mitigate risks and ensure adherence to anti-fraud regulations.

Source: Original reporting via Punch Newspaper