The Nigeria Financial Intelligence Unit (NFIU) has placed a ban on cash withdrawals from government operated accounts with all commercial banks in Nigeria, directing the banks stop honouring any demand or request for cash withdrawals from public accounts.
NFIU believes that the new measure will help to recover over N1 trillion from circulation, thus helping the Central Bank of Nigeria (CBN) in its fight to sanitise the liquidity in the system.
The new ban takes effect from March 1, 2023. In a new guideline that was issued by the anti-graft agency yesterday, all bank accounts operated by federal, state and local governments would be automatically exempted from carrying out cash-based transactions from March 1.
“Any government official who flouts the order will be prosecuted alongside his or her accomplices,” NFIU head, Modibbo Hamman Tukur said today in a media briefing in his Abuja office.
He however stated that any cash withdrawal from a public account will henceforth require a waiver from the President and such waiver will be considered on their merits.
The aim is to stop the curious rate of cash withdrawals from public accounts without recourse to the money laundering laws and sometimes for corrupt purposes, he said.
Tukur disclosed that from 2015 to date, state governments alone have withdrawn N701 billion from their various accounts, while Federal Government owned agencies withdrew N225 billion, with local government area authorities withdrawing over N156 billion cash within the same period, a situation he said is alarming.
Tukur said the decision is in line with the drive to make Nigeria a cashless economy. “Nigeria will become a full non-cash economy by March 1 this year. As a consequence, any government official that withdraws even one naira cash from any public account from March 1 will be investigated and prosecuted in collaboration with relevant agencies like EFCC and ICPC”.
NFIU said it noticed in the process of its financial transactions analysis that civil servants are becoming more and more vulnerable to money laundering and its predicate offences due to their exposure to cash withdrawals from public accounts.
He said cash withdrawals from public accounts will now be treated as money laundering. On state governors that would want to flout the directive, Tukur threatened that any state governor that withdrawals one naira cash from any bank will be investigated immediately not minding the governor’s immunity.
