As Nigerians await the conduct of the 2019 general elections, the Economic and Financial Crimes Commission is beaming its searchlight on politicians and political parties in a bid to track the sources of funds for their campaigns.
To this end, the commission has set up teams to monitor election spendings ahead of the elections.
Impeccable sources within the EFCC said it would also monitor the movement of money for the Ekiti governorship election, which holds on July 14.
Already, the EFCC Chairman, Mr. Ibrahim Magu, has met with the chief compliance officers of banks.
At the meeting, which held on May 30 this year, the EFCC chairman mandated banks to report all suspicious transactions ahead of the election, threatening to prosecute any bank that failed to cooperate.
It was learnt that Magu’s warning was sequel to a plea by the Independent National Electoral Commission that the EFCC should help in tackling vote-buying at polling units.
A top source at the EFCC, who spoke on condition of anonymity because he was not authorised to speak on the matter, said, “We have set up teams which will be relating with compliance officers of all banks. We will monitor them and if we discover that banks are colluding with unscrupulous individuals, we will prosecute the banks.
“Any bank that doesn’t disclose suspicious transactions would be prosecuted.”
The source explained that monies used in bribing INEC officials during 2015 elections emanated from banks and were routed through bank chiefs.
He added, “You will recall that the so-called $115m (N23bn) Diezani Alison-Madueke bribe, which was disbursed during the build-up to the 2015 general elections, were disbursed with the connivance of bank officials.
“During investigation, we arrested four managing directors of banks and even discovered that some of these funds were kept in the vaults of banks and this information was not given to financial regulation agencies.
“The money was used in bribing security and electoral officials which led to the suspension of about 205 INEC workers. We want to prevent a repeat of that in 2019.”
According to the Electoral Act, a presidential candidate should not expend more than N1bn on election campaigns.
A governorship candidate is allowed to spend a maximum of N200m, while a senatorial candidate must not spend more than N40m.
However, there are ongoing efforts to effect an upward review of these amounts through the controversial amended Electoral Bill currently pending before the National Assembly.
Magu had said in February that the EFCC would prevent politicians from sharing money at party conventions or at polling centres.
“We are working with INEC to make sure that we seal every window, every leakage before the election. We will block any avenue where people can move a lot of money, either physically in raw cash or through banks.
“We will prevent people from using money to buy votes or using money during convention for delegates. We have machinery in place,” the EFCC boss had said.
INEC had equally called on the EFCC to monitor the sources of funding of campaigns as elections approached.
According to the Chairman of INEC, Prof. Mahmood Yakubu, the electoral law also limits the amount of money that a person or association could donate to a political party.
He, however, said that most political parties and politicians had no regard for the law. He therefore called on the EFCC to assist INEC in curbing corruption.
“The Electoral Act places limits on the amount that each individual can spend in an election and also the amount which friends of candidates and parties can contribute to elections.
“We want the EFCC, which has the mandate and capacity to track and trace sources of funds, to work closely with us so that we can trace such sources within the limits of the law. Our democracy should never be on sale and I believe by working closely with the EFCC, we can achieve that,” Yakubu said.
The INEC chairman said the anti-graft agency should also help the electoral body to tackle the issue of bribing voters at polling units.
He said, “As we approach the 2019 general elections, we will require EFCC support essentially in two ways. Number one, INEC is worried by the recent trend of vote-buying at open polling stations. Candidates and parties go to polling stations with sacks of money to induce voters.
“Only the votes of citizens should determine who wins in an election. Our democracy must never be for sale on the open market. It is the will of the people that should determine who wins.”
PACAC, ex-INEC REC comment
Speaking with one of our correspondents, the Chairman, Presidential Advisory Committee Against Corruption, Prof. Itse Sagay (SAN), said the move by the EFCC was a laudable but difficult task.
Sagay said most times, corrupt politicians use proxies to move cash and in the process, circumvent the law.
He added, “It is a very difficult task. I don’t know if we have enough forensic equipment and training to be able to monitor the spending because the candidate does not have to spend it himself. If he gets the money through an illegitimate source, he would not spend it himself but give the money to various people that would do the spending.
“You wouldn’t see it in his bank account. The money would be distributed among his aides, henchmen and supporters so it will be very difficult to establish guilt in that respect.”
Speaking with one of our correspondents on Friday, a former INEC National Commissioner, Prof. Lai Olurode, said tracking election spending was almost impossible.
Olurode said even during primaries, candidates bribe delegates.
He said, “There is no deep-rooted and authentic scientific way to know the cost of election. It was a major issue I looked at during my inaugural election. Look at Ekiti State, for example. Look at how much aspirants spent on ordinary primaries. That is one you can even put a price on.
“You know the number of delegates and each delegate would have received nothing less than N50,000 each. That is even a conservative figure because it could be far more. Before then, they printed posters, erected posters and did all manner of things. So, how do you monitor that?
“They would have also visited traditional rulers, religious leaders, rented crowds, so it is almost impossible to probe. By my estimate, for just councillorship, which is just three wards, you would spend nothing less than N5m.”
On whether banks could help track funds, Olurode said, “These politicians have foreign exchange. They smuggle their money into the country. Sometimes, they can even move the money through their friends. How do you monitor that? It could even be by way of loan. They would get a loan for a business and use it for election. So, it is almost impossible.”
Meanwhile, some bank chief executive officers, who spoke on condition of anonymity, said lenders usually report suspicious transactions to security agencies through the Special Fraud Intelligence Unit of the Nigeria Police Force and the Central Bank of Nigeria, among others.
According to them, banks are by law required to report suspicious transactions and those beyond certain thresholds to security agencies.
They, however, said that the government had made such reporting activities (to security agencies) more important in recent times as the country approaches the 2019 elections.
“Routinely, we submit reports to security agencies on Politically Exposed Persons, which include politicians, government appointees and their families. We also submit reports on Financially Exposed Persons, which include lawyers to PEPs as well as real estate firms linked to PEPs. This is because these are some of the means through which PEPs could move funds,” the CEO of a mid-size bank said.
“Billions of naira are moved through the financial system on a daily basis and you can’t stop owners of the money from moving their funds. You can only report the movements to the relevant government agencies. So, we are cooperating with them, especially as the elections approach,” he added.
According to the CEO of a foreign bank operating in Nigeria, the banking sector already has structures in place including robust anti-money laundering rules for certain persons, especially PEPs.
The top banker said although these rules were expected to be followed to the letter by banks, some lenders had not been complying in the manner they should.
“Several transactions including those by Significant Political Persons are to be reported. For certain reasons, some banks may fail to comply with them. This was perhaps the reason why the EFCC chairman was critical of some banks when he met with the chief compliance officers of banks recently. But as a foreign bank in Nigeria, we comply strictly with these regulations,” the bank CEO explained.
