The Securities and Exchange Commission has directed all capital market-regulated entities to immediately subscribe to Nigeria’s Sanctions Alerts system.

The directive follows recent designations by Nigerian and international authorities of individuals and Bureau de Change operators allegedly involved in terrorism financing and providing material support to the Islamic State West Africa Province.

According to three circulars issued by the apex capital market regulator, the directive is a mandatory compliance measure. Entities that fail to comply could face sanctions ranging from fines and suspension of operations to outright revocation of their registration.

The directive, which aligns with the implementation of Financial Action Task Force statements on high-risk jurisdictions, underscores Nigeria’s intensified efforts to strengthen its anti-money laundering and counter-terrorism financing framework.

The development comes as Nigerian and international authorities intensify efforts to identify and sanction terrorism financiers with links to Nigeria. This follows recent action by the US government naming Nigerian nationals and six Nigerian companies allegedly involved in facilitating financial flows connected to the ISWAP.

The SEC’s broader circular on implementing FATF statements on high-risk jurisdictions also highlights Nigeria’s growing exposure to international regulatory scrutiny.

In line with directives from the Central Bank of Nigeria, the SEC now requires capital market-regulated entities to terminate correspondent banking relationships with designated high-risk jurisdictions, businesses and individuals.

“In line with the provisions of the Terrorism Prevention and Prohibition Act (TPPA), 2022, the Nigeria Sanctions Committee (NSC) has designated six (6) Individuals and three (3) Entities as terrorist financiers and subsequently added them to the Nigeria Sanctions List,” SEC stated in circular.

The circular mandated all capital market regulated entities and individuals to “Immediately, identify and freeze, without prior notice, all funds, assets, and any other economic resources belonging to the designated persons and entities in their possession and report same to the Secretariat of the Nigeria Sanctions Committee.

“Report to the Secretariat of the Nigeria Sanctions Committee any assets frozen or actions taken in compliance with the designation, including attempted transactions.

“Immediately file a suspicious transactions report to the Nigerian Financial Intelligence Unit (NFIU) for further analysis on the financial activities.

“Report as a suspicious transactions report to the NFIU, all cases of name matching in financial transactions prior to or after receipt of this Sanctions List.”

SEC added, “Subsequently prohibit dealings with the designated persons and entities; and continue to check for transactions relating to the designated persons and entities and report findings to the Nigeria Sanctions Committee through [email protected].

“Take Note that at all times, any unusual or suspicious transactions shall be promptly reported to the NFIU.”

The directive means capital market operators are expected to urgently review their anti-money laundering and counter-terrorism financing systems to ensure they are subscribed to NigSac Alerts and have the capacity to automatically flag designated individuals and entities.