Viewing cable 08ABUJA578
Title: CODEL SHELBY MEETS WITH ACTING EFCC CHAIRMAN

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08ABUJA5782008-03-31 16:24:00 2011-08-30 01:44:00 CONFIDENTIAL Embassy Abuja
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C O N F I D E N T I A L SECTION 01 OF 03 ABUJA 000578 
 
SIPDIS 
 
SIPDIS 
 
DOE FOR PERSON 
DEPT PASS USTR FOR AGAMA 
 
E.O. 12958: DECL: 03/27/2018 
TAGS: PGOV OREP PREL KCOR EFIN ECON NI
SUBJECT: CODEL SHELBY MEETS WITH ACTING EFCC CHAIRMAN 
 
 
Classified By: Ambassador Robin R. Sanders for reasons 1.4 (b & d) 
 
 ¶1. (C) SUMMARY.  Senators Shelby, Gregg and Corker met with 
Acting Economic and Financial Crimes Commission (EFCC) 
Executive Chairman Ibrahim Lamorde on March 17 in Abuja. 
Ambassador, EconCouns and INLOff also attended. The meeting 
focused on the activities of the EFCC regarding corruption, 
money laundering and terrorist financing. The meeting also 
addressed banking sector reform and the problem of oil 
bunkering in the Niger Delta.  Lamorde explained that the 
EFCC has evolved its focus from money laundering and 
financial fraud cases, such as "419" e-mail scams, to 
handling all financial crimes including the prosecution of 
high-ranking government officials for corruption.  He opined 
that no matter what resources are devoted to alleviating 
poverty, those resources will continue to be squandered until 
corruption is addressed. Lamorde assured the Senators the 
EFCC is independent, reporting only to the National Assembly 
and the Office of the President. He also noted that the EFCC 
can prosecute cases internally without reporting to the 
Attorney General. END SUMMARY. 
 
¶2. (C) Senators Richard Shelby, Judd Gregg and Bob Corker, 
accompanied by Ambassador, EconCouns, staffers and INLOff 
(notetaker) met with Acting EFCC Chairman Lamorde at EFCC 
headquarters in Abuja on March 17.  Lamorde introduced Chief 
of Staff Dapo Olorunyomi, Head of External Relations and Fund 
Raising Mr. Mohammed Bamalli, Head of Operations in Abuja Mr. 
Bala Ciroma, Assistant Team Leader for the Terrorism Finance 
Unit for the Nigerian Financial Intelligence Unit (NFIU) Mrs. 
Biola and First Special Assistant to the Acting Chairman Mr. 
Musa Bello.  Senator Shelby indicated that the CODEL was 
primarily interested in money laundering and terrorism 
financing, as well as the challenges that the EFCC faces. 
Lamorde proceeded to describe the EFCC's history and 
activities. 
 
¶3. (C) Lamorde said he has been with the EFCC since its 
inception in 2003. Since that time the EFCC has evolved its 
focus from money laundering (M/L) related to illicit drug 
proceeds and financial fraud cases, such as "419" e-mail 
scams, to handling all financial crimes including the 
prosecution of high-ranking government officials for 
corruption. In fact, Lamorde noted that the need for creating 
the EFCC and expanding its mandate became clear when the 
Financial Action Task Force (FATF) placed Nigeria on its 
warning list of countries with deficient monitoring of 
financial institutions. The image of the Nigerian banking 
sector was tainted. Most banks at the time were sole 
proprietorships with insufficient capitalization and 
inadequate oversight. Lack of oversight led to the collapse 
of several banks, problems with fraud and money laundering, 
and loss of confidence in the banking sector. To rehabilitate 
the image of its financial institutions, the GON reduced the 
number of banks from 100 to just 24 at present, required 
larger capital reserves, increased deposit insurance 
requirements and established new rules on bank ownership. In 
addition, the GON amended its 1995 Money Laundering Law and 
passed the Money Laundering (Prohibition) Act of 2004 to 
include all financial crimes such as public corruption, drugs 
and 419 scams. 
 
¶4. (C) According to Lamorde, there was a need to establish 
the NFIU not only to track M/L in the banking sector but also 
terrorism financing (T/F), particularly after the events of 
9/11. Since its creation under the EFCC Establishment Act of 
2004, the NFIU has worked aggressively to successfully remove 
Nigeria from the FATF list of non-cooperative countries. The 
NFIU subsequently became a member of the prestigious Egmont 
Group and now shares and receives intelligence information 
from other member FIUs. Because of the NFIU's actions, banks 
are now subject to monitoring of their activities and to 
reporting requirements through Suspicious Transaction Reports 
(STRs) and Currency Transaction Reports (CTRs). This type of 
monitoring has revealed several cases of corruption. For 
instance, through monitoring STRs, an Inspector General of 
Police, who was found to be extremely corrupt, was 
prosecuted, convicted and his assets seized and forfeited. 
Other public officials such as senators, governors and civil 
servants have also been detected and successfully prosecuted. 
Regarding T/F, Lamorde indicated that the EFCC is building a 
database of all charities which will allow them to monitor 
 
ABUJA 00000578  002 OF 003 
 
 
membership and finances to determine the source of funding. 
He acknowledged that monitoring the finances of charities is 
difficult as most funds come in the form of undeclared 
donations. However, he commented that the best indication of 
suspicious activity is the outward display of wealth by the 
charity that has not been reported and that the EFCC will 
generally investigate such cases. 
 
¶5. (C) Senator Shelby asked about illegal activities in the 
Niger Delta and the issue of poverty and the distribution of 
wealth. Lamorde explained that the Niger Delta is a resource 
rich region of Nigeria which faces a serious problem with oil 
bunkering, with a nexus to arms trafficking, which he 
described as criminal in nature and not related to any 
political or social issues as often claimed.  He added that 
no matter what resources are devoted to alleviating poverty, 
those resources will continue to be squandered until 
corruption is addressed. He also noted the prevalence of 
kidnapping and extortion which he attributed to petty 
criminal gangs that operate in the area. 
 
¶7. (C) Senator Shelby asked about the oversight and 
monitoring of the banking sector. He posited that if banks 
developed a better understanding of their customers' needs 
and focused on strengthening the relationship with their 
clients, they could more effectively monitor illegal 
transactions. Lamorde responded that banks in Nigeria are 
fairly large and attempt to serve a broad and diverse 
clientele. Due to the volume and complexity of financial 
transactions, banks must be alert to illegal activities and 
are required to submit STRs and CTRs as they are in the best 
position to monitor their clients' transactions, particularly 
in cases of public corruption where deposited funds exceed 
the official's declared assets and sources of income under 
public disclosure laws. 
 
¶8. (C) Senator Shelby also asked for the EFCC's insights into 
the movement of cash by couriers and the difficulty of 
monitoring transfers over borders. Lamorde acknowledged that 
Nigeria has large borders such as the border with Cameroon 
that are not well monitored. However, he noted that there 
have been large seizures of cash at official border posts. 
The perpetrators are generally wealthy Lebanese or South 
Asians who convert Nigerian currency into US dollars for the 
purpose of depositing the funds in Dubai where banking 
regulations are lax. Senator Shelby asked whether such 
persons are being monitored. Lamorde stated that a 
significant number of 419 e-mail scams are conducted by 
Lebanese and that it is very difficult to monitor their 
finances as they immediately transfer funds to other Lebanese 
accounts around the world. 
 
¶9. (C) Senator Gregg inquired whether the EFCC is 
independent, who it reports to, and whether it has powers of 
arrest and prosecution. Lamorde said the EFCC reports to the 
National Assembly in its oversight capacity and the Office of 
the President. He emphasized that EFCC has an internal 
prosecution unit and does not have to report to the Attorney 
General. 
 
¶10. (C) Senator Corker asked about illegal oil bunkering. 
Lamorde responded that pilfering is high and that pipelines 
are routinely sabotaged. The oil is then sold on the black 
market, in some cases to countries with refinery capacity but 
no oil resources. For instance, refineries in Cote d'Ivoire 
and Cameroon have routinely purchased bunkered Nigerian oil. 
The origins of the oil were identifiable from its physical 
characteristics.  When the GON discovered these instances of 
illegal bunkering, it made arrangements to sell legal crude 
oil to these refineries in order to discourage continued 
trade in illegal oil. Senator Corker asked what the 
difference in price was at the time. Lamorde stated that it 
depended on the prevailing market price but that the impurity 
of the bunkered oil appreciably raised refining costs. 
However, he cited examples of specific instances, where 
bunkered oil sold at discounts of 20-30 percent. Lamorde 
added that the EFCC had reduced its presence in the Delta as 
violence increased and the military had to be called in. 
 
¶11. (SBU) Senator Shelby thanked Lamorde for the discussion 
and invited him to visit the Senate next time he is in the 
US. 
 
ABUJA 00000578  003 OF 003 
 
 
 
¶12. (U) CODEL did not have an opportunity to clear this 
message prior to its departure. 
SANDERS