Understanding Post-No-Debit/Freezing Orders on Bank Accounts in Nigeria

One fundamental human right guaranteed under Nigerian law is the right to own property guaranteed by The Constitution of The Federal Republic of Nigeria 1999(as amended), but this right is not without its limits.

In the interest of justice and the preservation of the proceeds of crime, a court of law or special prosecution agency can through a temporary instrumentality known as a Post-No-Debit or Freezing/Forfeiture order made ex-parte (meaning “on one side only”or without an appearance by the party the order is aimed at), freeze a bank account or even blacklist a Bank Verification Number (BVN) of a person deemed a suspect with a view to ensuring that criminal proceedings, particularly investigation and prosecution, does not become a waste of time or nullity.

This article will be looking at Post-No-Debit/Forfeiture Orders on bank accounts , from their requirements to lifespan to courts with jurisdiction to grounds for revoking them.

Which court is vested with jurisdiction regarding the power to make Post-No-Debit or Forfeiture orders?

The Federal High Court of Nigeria is vested with the original jurisdiction to make Forfeiture orders as long as they are banking matters not within the scope of banker/customer relations.

Which agencies dubbed ‘special prosecutors’ also have the power to procure temporary forfeitures on bank accounts in Nigeria?

– The Economic and Financial Crimes Commission (EFCC)  through its Sections 29&34 of the Economic and Financial Crimes Commission 2004 is empowered to approach the court for an interim order of forfeiture and freezing order on banks or other financial institutions and such order may only be discharged where the defendant is discharged and acquitted.

– The Asset Management Corporation of Nigeria (AMCON) through relevant provisions of the AMCON Act 2019 also has the power to obtain an order ex-parte to freeze a debtor’s account and such order may subsist till judgment or a final determination/conclusion of the action.

– The Recovery of Public Property (Special Provisions) Act allows the court to make an interim attachment in a pending trial where a prima facie case has been made out warranting the grant of the Post-No-Debit order.

– The Proceeds of Crime (Recovery & Management) Act 2022 through its Section 19 provides that freezing orders on property like bank accounts can be granted where such accounts are believed to possibly and reasonably contain monies constituting the proceeds of crime.

What are the requirements for making Post-No-Debit/Forfeiture orders?

To secure a post-no-debit or forfeiture order, the following requirements must be present :-

– A situation of urgency which is not attended to by an order, will render any further proceedings of no effect and an exercise in futility.

– Showing sufficiently that granting such orders are in the interest of justice.

– An undertaking to indemnify the party against whom the order is made  against any damages suffered should subsequent legal proceedings in that regard turn out to be frivolous.

How long do such freezing orders typically last, especially when granted by the Federal High Court?

Freezing orders on bank accounts are not meant to be perpetual or indefinite . Therefore, they last for the following periods :-

– Not more than 14(Fourteen) days after the party or person affected by the order has applied for the order to be varied or discharged.

– Another 14 days after an application to vary or discharge it has been argued.

– In the case where an application to vary or discharge an order ex-parte is not taken within 14 days of Its being filed, the ex-parte freezing order shall lapse save for where the court makes a direction to the contrary in the interest of justice.

– A party affected by a freezing order made ex-parte can make an application to discharge or vary it within 14 days after service.