What does the term “Money Laundering” really mean?
People are always asking what does the term “Money Laundering” really mean; is it a legal concept or a political concept? I will try to break down and explain in simpler terms what the term “money laundering mean”; the offense of money laundering in Nigeria and its punishment as a legal concept.
Scenario: Let’s assume Mr. Ade made about N500m from illegal activities like international fraud scheme, drug trafficking, arms deal, oil bunkering etc and there is no how he can spend such amount of money or take it to the bank without drawing the attention of the authorities to verify the source of the income and know what Mr. Ade does for a living to justify him owning such an amount or having such a huge amount in his possession. Mr. Ade decides to invest the money in a business venture. The process of investing such illegally acquired money into a legit business thereby covering the illegal money tracks is what is called money laundering.
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Just like the name implies, laundering is an English word which simply means washing or cleaning; therefore, money laundering simply means the act of washing or cleaning a “dirty” or money gotten through illegal means to become clean or legal by investing the money into a legal or legitimate venture.
It can also be said to be the concealment of the origins of illegally obtained money, typically by means of transfers involving foreign banks or legitimate businesses or Money laundering is the practice of making money that was gained through criminal means, such as smuggling weapons, look as if it came from a legitimate business activity.
When authorities arrest an individual for money laundering, they are simply saying that his business or source of income does not justify him owning such a huge amount he owns and definitely the money is a proceeds of some illegal activities.
Money laundering is a crime in most countries of the world, it’s an international crime that the offender can be arrested and tried in any country where he committed the offense. It is also a high class offense in Nigeria and the Money Laundering (Prohibition) Act, 2011 subsequently Money Laundering Prohibition (Amendment) Act, 2012 in consonance with the Economic and Financial Crime Act, 2004 are the main laws that regulate and provide for the offense of and punishments for the crime of money laundering in Nigeria and the Economic and Financial Crimes Commission is the law enforcement agency charged with the statutory duties of arresting and prosecuting money launderers.
The Economic and Financial Crimes Commission has a special department whose sole purpose is to regulate, educate, arrest and prosecute criminals of money laundering. The department is called ; Special Control Unit Against Money Laundering (SCUML) and they have offices in most states in Nigeria.
The offense of Money Laundering in Nigeria is not just limited to the act of investing ill gotten money into a legitimate business, The Money Laundering (Prohibition) Act 2011 makes it illegal for any individual to accept or make any cash payment that exceeds N5m (Five Million Naira).
This implies that if an individual pays or accepts in payment a cash that is above N5m without making use of financial institutions, then the transacting parties have committed the crime of money laundering. The transacting parties found guilty of contravening this are liable to imprisonment for a term of not less than 3 years or a fine of N10m (Ten Million Naira) or to both.
The Money Laundering act provides for the punishment of 5-10 years jail term or more for anybody involved in money laundering activities in Nigeria.