Nigeria's CBN Cracks Down on Terror Financing, Freezes Multiple Accounts

The Central Bank of Nigeria (CBN) has issued a stringent directive to all banks, payment service banks, and other financial institutions, mandating the immediate freezing of accounts, funds, and assets linked to six individuals and four Bureau de Change (BDC) operators. This decisive action is part of intensified efforts by authorities to dismantle financial networks that support extremist activities, particularly terrorism financing.

This directive, communicated through a circular to all regulated financial institutions, follows recent sanctions imposed by the Nigeria Sanctions Committee (NIGSAC) and the United States Department of the Treasury's Office of Foreign Assets Control (OFAC) under Executive Order 13224, as amended. The CBN's move comes closely after the United States government designated several Nigerian citizens and Nigeria-based foreign exchange operators for allegedly facilitating financial transactions on behalf of the Islamic State West Africa Province (ISWAP), a prominent terrorist organization operating in the Lake Chad region.

In the circular, signed by Olubunmi Ayodele-Oni on behalf of the director of the Compliance Department, the apex bank explicitly identified the sanctioned individuals. These include Muktar Muhammad Adamu, Babangida Muhammed Adamu Hammajam, Abdullahi Umar Usman, Ibrahim Abubakar, Adamu Chiroma, and Yakubu Ogirima Ibrahim. Additionally, four Nigeria-based Money Service Businesses and Bureau de Change operators, alleged to be owned or controlled by these designated persons, were listed: Generation Currency Bureau de Change Limited, Manhattan Bureau de Change Limited, Nine to Nine Exchange Bureau de Change Limited, and Abbal Bako & Sons Bureau de Change Limited.

The CBN emphasized that these sanctions are binding and require immediate implementation by all financial institutions. The Nigeria Sanctions List was updated on June 18, 2026, and financial institutions are instructed to identify and freeze, without prior notice, all funds, assets, and economic resources belonging to or controlled directly or indirectly by these designated individuals and entities. The directive further extends to companies and organizations that are 50 percent or more owned, either individually or collectively, by the sanctioned persons. The apex bank also strictly warned financial institutions against making any funds, financial services, or economic resources available to the affected individuals and entities, whether directly or indirectly.

To ensure robust compliance, banks are mandated to immediately file Suspicious Transaction Reports (STRs) with the Nigerian Financial Intelligence Unit (NFIU) for any confirmed or attempted transactions involving the designated persons. Furthermore, all institutions must submit compliance reports within 48 hours, detailing any matches found, the number of affected accounts, the amounts frozen or restricted, and actions taken. Even institutions that record no matches are required to submit mandatory nil returns, underscoring the CBN's comprehensive approach to monitoring.

Beyond asset freezes and reporting, the regulator has ordered financial institutions to significantly strengthen their surveillance mechanisms for terrorism financing risks. This includes diligent monitoring for unusual movement of funds, structured transactions, the use of money service businesses and informal transfer channels, and any dealings involving high-risk jurisdictions. Banks are also directed to conduct comprehensive reviews of customer relationships and historical transactions to uncover any previous or attempted dealings connected to the designated individuals and organizations. The CBN issued a stern warning that all submitted reports must be accurate, complete, and verifiable, stressing that any false declarations or misleading information would constitute regulatory breaches punishable under the Banks and Other Financial Institutions Act (BOFIA) 2020 and other applicable laws. Compliance verification will be conducted through various means, including off-site monitoring, on-site examinations, and supervisory engagements across the entire banking industry.