Halt Implementation of KYC now – Reps tell CBN

By Christiana Ekpa

The house of Representatives on Tuesday asked the Central Bank of Nigeria (CBN) to halt the implementation of the “Know Your Customer” directive with immediate effect.

The house equally mandated it’s Committee on Legislative Compliance (when constituted) to ensure
implementation of KYC directive.

The House resolutions was sequel to the adoption of a motion by a member from Rivers state Hon. Kelechi Nwogu during plenary.

Hon. Nwogu stated that the CBN has recently released its Customer Due Diligence Regulations, 2023, and it’s Know Your Customer directive to galvanize compliance with anti-money laundering and counter-terrorism financing provisions.

According to him, obtaining the additional information, would be useful to financial institutions in accessing
customers’ online presence and activities, thus enabling better assessment of potential risks associated with money laundering, terrorism financing and proliferation financing

The lawmaker however, observed that as laudable as the directive may appear, it may be unnecessary as it is likely to bear pressure on teeming Nigerian masses at this trying period.

“Cognizant of the fact that this directive by the CBN is inconflict with the provision of Section 37 of the
Constitution of the Federal Republic of Nigeria, 1999 (as amended) on the right to privacy of Citizens.

“Also cognizantof the fact that banks in the country already have the names, telephone numbers, passport
photographs, emails, National Identification Number (NIN), Biometric Verification Number (BVN),
utility bills and other basic requirements with which to identify, know and monitor customers.

Nwogu stated that there are better means of monitoring money laundering, terrorism financing, and
proliferation financing, such as the Nigeria Police Force , Nigeria Financial Intelligence Unit, the Economic and Financial Crimes Commission (EFCC) as well as the intelligence and crime tracking agencies, amongst others.

He expressed concern that if the directive takes effect, Nigerians who are not on social media, with large turn overs from their businesses and trades, would be compelled to or systematically excluded from formal banking systems with its attendant negative effects and implications.

The lawmaker, added that the directive would also cause untold hardships to millions of Nigerians, especially the illiterates, or semiliterate business owners, traders and entrepreneurs living in the villages and rural areas, who do not have social media handles.

Adopting the motion, the house mandated the Committee on Banking and Currency (when constituted) to investigate the matter and
report back within three weeks for further legislative action.