Home General News Lax virtual asset rules aid criminals, says anti-money laundering expert | The...

Lax virtual asset rules aid criminals, says anti-money laundering expert | The Guardian Nigeria News

8
0


A certified fraud examiner and cryptocurrency investigator, Mr. Joshua Obiama, has warned that loopholes in the global regulation of virtual assets are being exploited by criminals, terrorists, and rogue regimes.

Obiama raised the alarm in Benin City while delivering a lecture to mark the 2025 African Union Anti-Corruption Day. The event, themed “Understanding Virtual Asset and Investment Fraud,” was organised by the Economic and Financial Crimes Commission (EFCC), Benin Zonal Command.

According to Obiama, most countries have yet to implement effective regulatory frameworks for virtual assets, allowing bad actors to exploit the system. He noted that while some countries have moved to regulate virtual assets, others have banned them entirely.

Citing the Financial Action Task Force (FATF), he described virtual currency as a digital representation of value that can be traded as a medium of exchange and a store of value, though it is not recognised as legal tender in many jurisdictions.

He explained that Nigeria does not recognise cryptocurrency as legal tender and pointed out that many unregulated and unregistered companies currently create cryptocurrencies. Their use within Nigeria, he said, violates existing financial laws.

Obiama recalled that in February 2021, the Central Bank of Nigeria (CBN) issued a directive prohibiting banks and financial institutions from dealing in or facilitating cryptocurrency transactions. The CBN also ordered financial institutions to close accounts linked to cryptocurrency trading.

He stressed that the absence of customer verification in crypto transactions makes them vulnerable to abuse, including money laundering and terrorism financing.

However, he acknowledged that recent legislation has changed the regulatory landscape. Under the Investment and Securities Act 2025, signed by President Bola Ahmed Tinubu, cryptocurrencies and other digital assets are now classified as securities. This means that virtual asset providers must register with and be regulated by the Securities and Exchange Commission (SEC).

Delivering the second lecture, titled “Investment Scam”, Mr Idris Oluremi linked the rise in fraudulent investment schemes to Nigeria’s worsening economic conditions, including inflation, high fuel prices, and widespread poverty.

Oluremi noted that desperation has driven many Nigerians to fall prey to scams offering unrealistic returns through schemes that often target small-scale investments.

In his address, EFCC Chairman Mr. Ola Olukoyede—represented by the Acting Benin Zonal Director, Mr. Effa Okim—described illicit financial flows as a major obstacle to Africa’s development, costing the continent billions annually.

Olukoyede noted that while virtual assets are not inherently criminal, their misuse can turn them into tools of financial crime. He reaffirmed the Commission’s resolve to combat fraud and assured that challenges associated with digital asset crimes are not insurmountable.

LEAVE A REPLY

Please enter your comment!
Please enter your name here