The Securities and Exchange Commission has ordered an immediate asset freeze of 13 newly designated alleged terrorism-linked entities across the capital market.
In a directive titled ‘Commission’s sweeping compliance directive issued to capital market operators,’ the SEC said the move followed the designation and blacklisting of 10 individuals and three entities on the Nigeria Sanctions List by the Nigeria Sanctions Committee.
The Commission anchored its directive on provisions of the Terrorism (Prevention and Prohibition) Act, 2022, which mandates the immediate freezing of all funds, assets, and economic resources linked to the named persons and organisations without prior notice.
The SEC stated that all Capital Market Operators and stakeholders have been notified that, pursuant to section 49 of the Act, the Nigeria Sanctions Committee has approved the addition of entries and entities subject to asset freeze, travel ban, and arms embargo.
The directive to freeze accounts and halt all transactions with the flagged entities is binding on all capital market operators and stakeholders, with strict reporting and compliance obligations including immediate identification and freezing of all assets linked to designated individuals and entities without prior notification, and mandatory reporting of frozen assets and attempted transactions to the Nigeria Sanctions Committee Secretariat.
Details accompanying the designation reveal that several of the individuals were convicted by the Abu Dhabi Federal Court of Appeal in April 2019 for terrorism financing activities linked to Boko Haram. The offences largely involved the alleged collection of funds in Dubai and transferring them to Nigeria to support terrorist operations. Sentences ranged from 10 years imprisonment to life sentences.
The SEC emphasized that the asset-freezing mechanism is preventive rather than punitive, designed to disrupt financial support systems for terrorism before funds can be deployed. The implications for non-compliance are severe, including both civil and criminal liabilities, as well as reputational damage for institutions found wanting.
The directive extends beyond traditional financial institutions to include Designated Non-Financial Businesses and Professions, signalling a more comprehensive enforcement approach across Nigeria’s financial ecosystem. The SEC noted that trading systems must be capable of rapid name screening, asset tracing, and reporting, while compliance teams are expected to act without delay or prior notice to affected clients.
