Bola A. Akinterinwa
NFIU is Nigerian Financial Intelligence Unit. It was set up with a mission statement to ‘safeguard the Nigerian financial system and contribute to the global fight against money laundering, terrorism financing and related crimes through the provision of credible financial intelligence.’ More important, the NFIU joined in 2007 the Egmont Group, an informal network of 165 financial Intelligence Units, ‘which provides a platform for the secure exchange of expertise and financial intelligence to combat money laundering and terrorist financing.’ And most importantly, ‘the NFIU is the central national agency responsible for the receipt of disclosures from reporting organisations, the analysis of these disclosures and the production of intelligence for dissemination to competent authorities.’ It is autonomous and domiciled within the Central Bank of Nigeria as a ‘coordinating body for the country’s Anti-Money Laundering, Counter-Terrorist Financing and Counter-Proliferation financing.’ It is against this background that the NFIU issued guidelines prohibiting cash withdrawals from accounts of the Federal Government, its agencies, State and Local Governments as from March 1, 2023.
Diplomatic Missions, as distinct from paradiplomatic missions and non-resident diplomatic missions, are accredited representatives of sovereign States to Nigeria. They do not owe responsibility to Nigeria as host State but to their own sending States, hence, they are considered exterritorial missions. They and their heads answer different designations, for various reasons. The Commonwealth countries, for instance, call their missions High Commission while the Vatican missions are referred to as Papal Nuncios. The French Community used to call theirs High Representatives. When a diplomatic mission is exchanged between a member of a group and another different State of another group, it is called an embassy. However, most diplomatic missions are still referred to as embassies. In the diplomatic lexicon and UN official languages, three main expressions are interchangeably used to describe sending and reception of an embassy: in French diplomatic language, pays d‘envoi and pays d’accueil or pays accréditant or pays accréditaire, are used and both of them, in English diplomatic language, mean Sending State and Receiving State. Lato sensu, diplomatic missions are headed by three categories of ambassadors: titled ambassadors or nuncios who are generally accredited to Heads of State; envoys, ministers and internuncios similarly accredited to Heads of State; and Chargé d’Affaires who are accredited to Ministers of Foreign Affairs. Though of different ranking, they are all considered the same, except in matters of protocolar order of precedence and etiquette (Article 14(2), Vienna Diplomatic Convention).
NFIU Guidelines and the Debate
The nexus between the diplomatic missions and the NFIU is quite interesting because of the debate it has generated on the extent of applicability of the NFIU cash ban guidelines to the diplomatic missions in Nigeria. In other words, can NFIU guidelines or Nigeria’s municipal law override the law of the sending States of diplomatic missions in light of international law? The Director and Chief Executive Officer of NFIU, Modibbo Tukur, has explained that the NFIU guidelines apply to all foreign missions operating in Nigeria, to all accounts of all development partner institutions, and to all the accounts of all instituted funds.
To a great extent, Mr. Modibo Tukur is perfectly in order with his submission, especially bearing in mind the requirement of the 1961 Vienna Convention on Diplomatic Relations which obligates all the diplomatic missions to respect the law and regulations of their receiving States. The law and regulations of the receiving State, Nigeria in this case, is as given by the NFIU. Thus, in addressing the issue of applicability of the NFIU guidelines, there are two main schools of thought on the matter: non-applicability proponents and applicability proponents. The arguments of both schools, based on the interviews held by ten reporters from The Sunday Punch, with some retired diplomats, are quite thought-provoking. The arguments looked at the international environmental conditionings, but placing little emphasis on the raison d’être of the NFIU as a national and regional outfit.
Without any shadow of doubt, the NFIU guidelines appear to have been largely inspired by many factors. First is the fact that, in the period from 2015 to 2022, the Federal Government collected the sum of N225.72bn, while the States withdrew N701.54bn, and the Local Governments withdrew N156.76bn all, in cash. In the words of Mr. Tukur, ‘the rate of withdrawal above the threshold from public accounts has been alarming, over N701bn has been withdrawn in cash from 2015 till date.’
Second is the consideration that strenuous efforts are being made by the Federal Government and Central Bank of Nigeria to fighting insecurity, especially terrorism financing in Nigeria. The seriousness of the anti-terrorism fighting has compelled the establishment of the Financial Intelligence Unit as a government specialised, regulatory and law enforcement agency around the world. In fact, the Intergovernmental Action Group Against Money Laundering in West Africa (GIABA) has to enable the establishment of an ‘FIU Forum whereby the directors meet on a regular basis, usually on the margins of GIABA Plenary or other regional meetings, in order to share their successes and their problems, seek advice on how to better fulfil their mandates and strengthen operational cooperation among themselves’ (vide Overview of GIABA Operations from 2004 to 2014; www.giaba.org, pp.33-34). This situational fact simply means that the personality of the NFIU may not be simply seen as Nigerian, but as one with a plurilateral and multilateral character.
A third reason is the decision of Government to ensure that all transactions involving government money are routed through the banks for reasons of transparency and accountability. It is against the foregoing considerations that diplomatic observers have argued for and against in the applicability of the NFIU cash ban guidelines. The three considerations have not seriously inspired the arguments of the non-applicability schools.
In the eyes of the proponents of applicability of the NFIU guidelines, the enforcement of the guidelines and policy is to mitigate money laundering, terrorism financing, and proliferation of weapons and prevent predicate crimes. Former Ambassador of Nigeria to Algeria, Mohammed Mabdul, has argued that ‘even though the foreign embassies represent their home countries, the moment they are posted to another country, they are governed by the laws of the country. That is the standard procedure, especially when such laws do not contravene international best practices.’
For instance, Ambassador Mabdul has noted that ‘there are certain financial regulations that are practised, not only in the local banks, but by all the banks, around the world. Most financial institutions operate to protect transactions of money in a legal way and to avoid illegal activity, which included money laundering and misappropriation of funds. These policies are being regulated in most countries. It is some developing countries that are relaxed in enforcing such a policy.’
From the perspectives of the proponents of non-applicability of the NFIU guidelines, it is argued from a legal standpoint, by Jibrin Okutepa, SAN, that the NFIU has no power to stop any State government from withdrawing cash. Besides, the Balyesa State Attorney-General and Commissioner of Justice, raised reservations about the guidelines and promised to challenge in court the constitutionality of the policy, in the belief that Nigeria is not a unitary State but a federation made up of sub-nationals.’ Ambassador Ogbole Amedu-Ode raised the challenges militating against the application of the NFIU guidelines: legal enforcement of rules and regulations, inviolability of diplomatic agents, difficulty in differentiating between accounts belonging to diplomatic missions and Nigerian public institutions.
In the same vein, Ambassador Rasheed Akinkuolie gave the reasons of immunity and reciprocity as major challenges to the application of the guidelines. As he reportedly put it, ‘diplomatic missions in Nigeria fall under “exceptions to the guidelines” in the NFIU cash withdrawal policy. Foreign missions cannot be restrained in any way in their legitimate activities in a host country, including their financial transactions.’ More importantly, Ambassador Akinkuolie hypothesised, ‘if there is insistence on applying the stringent regulations by the Nigerian government, the same restrictions will be placed on all Nigerian diplomatic missions abroad. Diplomatic immunity for diplomats and missions is a mutually agreed convention, which countries are careful not to violate because of the consequences.’
And perhaps more interestingly, former Ambassador of Nigeria to Angola, Folorunso Otukoya, also observed that ‘whatever the specifics of the guidelines may contain, embassy accounts are not regarded as local. Since remittances come into them directly from their sending States, it may be difficult to strictly impose those guidelines to the letter.’ Most significantly, Ambassador Otukoya also considered his empirical experiences abroad to inform that Central Banks elsewhere ‘have often prevented embassies from paying local currencies into their accounts once they withdraw the forex equivalent. This is to prevent what we call “double tripping.” It is to prevent missions from back to deposit into their accounts to do local expenses. It’s an elaborate system but most missions still find ways of circumventing those provisions.’
Without scintilla of doubt, all the arguments for and against applicability of the NFIU guidelines are logically tenable. However, we strongly believe that the proponents of applicability have an edge over the non-applicability proponents. In spite of this, the applicability of the guidelines is unwanted
NFIU Guidelines: Applicable But Unwanted
Ambassador Otukoya’s observation that diplomatic missions can find other ways of circumventing legal provisions cannot but be most unfortunate in light of the several limitations to the exercise of sovereignty and rule of exterritoriality provided for in the Vienna Convention on Diplomatic Relations. Put differently, if there are exceptions or limitations to the exercise of state sovereignty in the convention, it simply means that the NFIU cash ban guidelines cannot but also have their own domains of application and non-application.
Consequently, we posit here that the NFIU guidelines are applicable to all diplomatic missions as representatives of sovereign States. The municipal law of the sending States cannot be enforced in the host States, but only within the context of their embassies, diplomatic residences, diplomatic vehicles and paraphernalia needed for representational purposes, protection of their interests in the host countries, negotiations with their host governments, and promotion of bilateral friendly relations. If there is conflict of interest, Article 3(C) of the Vienna Convention on Diplomatic Relations enables bilateral negotiations and where negotiation still fails, the rule of reciprocity may apply with or without consequences.
For instance, Article 23(2) provides for an exception to ‘dues and taxes payable under the law of the receiving State. There is limitation in the enjoyment of immunity from the criminal, civil and administrative jurisdiction of the receiving State (Article 31). The inspection of the personal baggage of diplomatic agents is permissible when ‘there are serious grounds for presuming that it contains articles not covered by the exemptions mentioned in paragraph 1 of this Article…’ (vide Article 36). In the particular case of the NFIU cash ban regulations, Article 41(1) provides that ‘without prejudice to their privileges and immunities, it is the duty of all persons enjoying such privileges and immunities to respect the laws and regulations of the receiving State. They also have a duty not to interfere in the internal affairs of that State.
The useful point from the foregoing is that the laws and regulations of the receiving State are at all times applicable for purposes of good governance, peace and security in the mutual interest of all the stakeholders. However, exemptions to the rules and regulation are often provided for in the spirit of reciprocal treatment.
On the specific issue of non-interference in the internal affairs of the receiving State, it is useful to understand the principle of non-interference in context. While the Constitutive Act of the African Union provides in its Article 4(g) for ‘non-interference by any Member State in the internal affairs of another,’ the United Nations Charter provides for non-intervention in its Article 2(7): ‘Nothing contained in the present Charter shall authorise the United Nations to intervene in matters which are essentially within the domestic jurisdiction of any state or shall require the Members to submit such matters to settlement under the present Charter; but this principle shall not prejudice the application of enforcement measures under Chapter VII.’
In this regard, even though some observers often wrongly use non-interference to imply non-intervention, the two words do not mean the same in international law and relations. When interference is devoid of use of force, it is called interference and permissible and when it involves the use of force, we talk about intervention and therefore about illegality. When President Muhammadu Buhari talked about non-interference in the electoral affairs of Nigeria last week, he was not making any serious point because interferences are daily occurrences in international life and relations. The mere fact that one stays in Nigeria and commenting, commending or condemning policies of other countries is necessarily an act of interference. Accepting international election monitors or acceptance of electoral training assistance and funding are manifestations of interference.
It is when an act of interference is forceful, especially without express invitation by the legitimate government in power that intervention is prohibited. That is the appropriate interpretation of Article 2(7) of the UN Charter. As a matter of fact, the controversy surrounding the meaning of non-intervention as provided in Article 2(7) prompted the United Nations to set up a Special Committee on Principles of International Law Concerning Friendly Relations and Cooperation among States which had as one of its mandates the study of the principle of non-intervention. For instance what really are the matters falling under the jurisdictional competences of a State that should not be disrupted? In the context of the NFIU guidelines, to what extent can accredited diplomatic missions interfere, not to talk about intervention, in the adoption processes of the guidelines or in the disregard for the guidelines?
Without gainsaying, the NFIU has done well for coming up with monetary policies that have the potential to deal with institutional corruption and terrorism financing. As to whether Nigeria’s municipal law can override the law and regulations of foreign countries largely depends on regional and bilateral cooperation agreements. Diplomatic missions are not only required to settle the bills for services provided their host countries, and in truth, they settle such bills. For example, in the 1980s, one tit-for-tat misunderstanding in the 1980s, between the Nigeria High Commission in London and the British Government, on the one hand, and the Embassy of Nigeria in Paris and the French Government, on the other hand, is noteworthy. The matter was about payment for parking in front of the Nigerian diplomatic missions. The British High Commission in Lagos then had free parking, because there were no parking metres by then, so there was no basis to challenge the British for payment. In France and in Britain, parking slots abound and they are to be paid for if used. Nigerian diplomatic vehicles were parked, but without any conscious effort to pay. When complaints were raised against the Nigerian missions, the response was that neither Britain nor France was paying for parking in Nigeria and that there was no good reason for them to pay for parking in the UK and France. The Nigerian logic was based on the rule of reciprocity. Thus, the municipal laws of sending States and those of the receiving States can always conflict. Should France and the United Kingdom be held responsible for no fault of theirs? They shouldn’t have been held responsible for trying to generate revenue for their growth and development. But because international diplomatic practice allows for reciprocal treatment, Nigerian missions afforded the luxury of holding their host countries to ransom, punishing them for Nigeria’s policy inadequacies or for not having parking slots in Nigeria. It is from this perspective that the NFIU cash ban guidelines should be internationally presented and understood. The guidelines are applicable but they should be cautiously applied to avoid counter-productivity.