Section 7 Money Laundering Act

Section 7 of the Money Laundering (Prevention and Prohibition) Act 2022 is about Suspicious transaction reporting. It provides as follows:

(1) Where a transaction—
(a) involves a frequency which is unjustifiable or unreasonable,

(b) is surrounded by conditions of unusual or unjustified complexity,
(c) appears to have no economic justification or lawful objective,
(d) is inconsistent with the known transaction pattern of the account or business relationship, or

(e) in the opinion of the financial institution or non-financial business and profession involves the proceeds of a criminal activity, unlawful act, money
laundering or terrorist financing, that transaction shall be deemed to be suspicious and the financial institution and designated non-financial business and profession involved in the transaction shall report to the Unit as the case may be immediately.

(2) A financial institution or designated non-financial business and profession shall within 24 hours after the transaction referred to in subsection (1)—

(a) draw up a written report containing all relevant information on the matters mentioned in subsection (1) together with the reasons and identity of the principal and, where applicable, of the beneficiary or beneficiaries ;
(b) take appropriate action to prevent the laundering of the proceeds of a crime or an illegal act ; and
(c) report the suspicious transaction and actions taken to the Unit.

(3) The provisions of subsections (1) and (2) shall apply whether the transaction is complete or not.

(4) The Unit shall acknowledge receipt of any disclosure, report or information received under this section and may demand such additional information as it may deem necessary.

(5) The acknowledgement of receipt shall be sent to the financial institution or designated non-financial business and profession within the time allowed for the transaction to be undertaken and it may be accompanied by a notice deferring the transaction for a period not exceeding 72 hours.

(6) Notwithstanding the provisions of subsection (5), the Unit or the Commission or the authorised representatives shall place a stop order not exceeding 72 hours, on any account or transaction if it is discovered that such account or transaction is suspected to be involved in any unlawful act.

(7) If the acknowledgment of receipt is not accompanied by a stop notice, or where the stop notice has expired and the order specified in subsection

(8) to block the transaction has not reached the financial institution or designated non-financial business and profession, it may carry out the transaction.

(8) Where it is not possible to ascertain the origin of the funds within the period of stoppage of the transaction, the Federal High Court may, at the request of the Unit or the Commission or their authorised representatives order that the funds, accounts or securities referred to in the report be blocked.

(9) An order made by the Federal High Court under subsection (8) shall be enforced forthwith.

(10) A financial institution or designated non-financial business and profession which fails to comply with the provisions of subsections (1) and (2) commits an offence and is liable on conviction to a fine of N1,000,000 for each day during which the offence continues.