Section 7: Laundering of fund obtained through unlawful activity, etc.

(1) A person who conducts or attempts to conduct a financial transaction which in fact involves the proceeds of a specified unlawful activity-
(a) with the intent to promote the carrying on of a specified unlawful activity; or
(b) where the transaction is designed in whole or in part -
(i) to conceal or disguise the nature, the location, the source, the ownership or the control of the proceeds of a specified unlawful activity; or
(ii) to avoid a lawful transaction under Nigerian law, commits an offence under this Act if he knows or ought to know, having regard to the circumstances of the case, that the property involved in the financial transaction represents the proceeds of some form of unlawful activity.
(2) A person who commits an offence under subsection (1) of this section, is liable on conviction-
(a) in the case of a financial institution or corporate body, to a fine of N 1 million and where the financial institution or corporate body is unable to pay the fine, its assets to the value of the fine shall be confiscated and forfeited to the Federal Government; or
(b) in the case of a director, secretary or other officer of the financial institution or corporate body or any other person, to imprisonment for a term, not more than 10 years and not less than five years.
(3) When as a result of negligence, or regulation in the internal control procedures, a financial institution fails to exercise due diligence as specified in the Banks and Other Financial Institutions Act, 1991 as amended or the Money Laundering (Prohibition) Act, 2004 in relation to the conduct of financial transactions which in fact involves the proceeds of unlawful activity-
(a) the financial institution commits an offence and is liable on conviction to refund the total amount involved in the financial transaction and not less than N100.000 sanction by the appropriate financial regulatory authority;
(b) a director, secretary, employee or other staff of the financial institution who facilitates, contributes or otherwise is involved in the failure to exercise due diligence as stipulated under this section, commits an offence and is liable on conviction to imprisonment for a term not less than three years and may also be liable to be banned indefinitely for a period of three years from exercising the profession which provided the opportunity for the offence to be committed.
(4) A person who transports or attempts to transport a monetary instrument or funds from a place in Nigeria to or through a place outside Nigeria or to a place in Nigeria from or through a place outside Nigeria -
(a) with the intent to promote the carrying on of specified unlawful activity; or
(b) where the monetary instrument or funds involved in the transportation represent the proceeds of some form of unlawful activity and the transportation is designed in whole or in part -
(i) to conceal or disguise the nature, the location, the source, the ownership, or the control of the proceeds of a specified unlawful activity; or
(ii) to avoid a lawful transaction under Nigerian law,
commits an offence under this Act, if he knows or ought to know, having regard to the circumstances of the case, that the monetary instrument or funds involved in the transportation are the proceeds of some form of unlawful activity and the intent of the transaction
(5) A person who commits an offence under subsection (3) of this section is liable on conviction to a fine of N500.000 or twice the value of the monetary instrument or funds involved in the transportation, whichever is higher, or imprisonment for a term of not less than 10 years or to both such fine and imprisonment.
(6) In this section -
(a) "conducts" includes initiating, being involved, connected with, concluding, or participating in initiating or concluding a transaction;
(b) "financial institution" means banks, body association or group of persons, whether corporate or incorporate which carries on the business of investment and securities, a discount house, insurance institutions, debt factorization and conversion firms, bureau de change, finance company, money brokerage firm whose principal business includes factoring, project financing, equipment leasing, debt administration, fund management, private ledger services, investment management, local purchase order financing, export finance, project consultancy, financial consultancy, pension funds management and such other businesses as the Central Bank of Nigeria or other appropriate regulatory authorities may from time to time designate.
(c) "financial transaction" means -
(i) a transaction involving the movement of funds by wire or other means or involving one or more monetary instruments, which in any way or degree affects foreign monetary instruments; or
(ii) a transaction involving the use of a financial institution which is engaged in, or the activities of which affect, foreign commerce in any way or degree;
(d) "knows or ought to know that the property involved in a financial transaction represents the proceeds of some form of unlawful activity" means that the person knew or ought to have known that the property involved in the transaction represented proceeds from some form, though not necessarily which form, of activity that constitutes an offence under this Act;
(e) "monetary instrument" means coin or currency of Nigeria or of any other country, traveller's cheque, personal cheque, bank cheque, money order, investment security in bearer form or otherwise in such form that title thereto passes upon delivery;
(f) "proceeds" means any property derived or obtained, directly or indirectly through the commission of an offence under this Act;
(g) "property" includes assets, monetary instruments and instrumentalities used in the commission of an offence under this Act;
(h) "specified unlawful activity" means -
(i) any act or activity constituting an offence under this Act;
(ii) with respect to a financial transaction occurring in whole or in part in Nigeria, an offence against the laws of a foreign nation involving obtaining property by fraud by whatever name called;
(i) "transaction" includes a purchase, sale, loan, pledge, gift, transfer, delivery, or other disposition, and with respect to a financial institution, includes a deposit, withdrawal, transfer between accounts, exchange of currency, loan, extension of credit, purchase or sale of any stock, bond, certificate of deposit or other monetary instrument, or any other payment, transfer, or delivery by, through, or to a financial institution, by whatever means effected.