The Central Bank of Nigeria (CBN) Anti-Money Laundering, Combating the Financing of Terrorism, and Countering the Financing of Proliferation of Weapons of Mass Destruction in Financial Institutions Regulations, 2022 provides an enhanced and comprehensive compliance framework for regulated entities. It significantly strengthens Nigeria’s alignment with the Financial Action Task Force (FATF) Travel Rule (WTR), particularly through its stipulations for wire transfers and customer due diligence (CDD).

Application of the Travel Rule

Regulation 33 explicitly addresses wire transfers, establishing that for any transaction equal to or exceeding US$1,000, financial institutions must collect and maintain originator and beneficiary information. This includes full names, account numbers or unique transaction identifiers, addresses or national ID numbers, and other unique identifiers to ensure traceability. For cross-border transactions, this information must accompany the transfer message and be retained throughout the payment chain. Domestic transfers require full originator and beneficiary information or a traceable identifier that can be retrieved within three business days. These requirements mirror FATF Recommendation 16 and ensure robust implementation of the Travel Rule across cross-border and domestic wire transfers.

Responsibilities of Financial Institutions

Ordering institutions are mandated to collect and verify full originator data and include it with the payment. Beneficiary institutions must similarly collect and verify beneficiary data if not previously obtained. Both ordering and beneficiary institutions must maintain comprehensive records of all wire transfers. Intermediary institutions are required to ensure that all information accompanying a wire transfer is preserved and transmitted downstream. They must also take reasonable measures to detect and manage instances where required information is missing, using risk-based procedures to determine when to execute, reject, or suspend such transactions.

Monitoring, Reporting & Sanctions

Institutions must monitor all wire transfers for the presence of required data and report incomplete or suspicious transactions to the Nigerian Financial Intelligence Unit (NFIU). Regulation 33(14) mandates freezing transactions associated with individuals or entities designated under United Nations Security Council Resolutions or Nigerian counter-terrorism laws. Failure to comply with Travel Rule requirements may result in administrative sanctions, criminal penalties, or regulatory intervention, reinforcing the regulatory emphasis on strict adherence.

Oversight of Money or Value Transfer Services (MVTS)

Regulation 32 integrates WTR obligations for MVTS operators. They must collect originator and beneficiary data, monitor for completeness, and ensure transmission continuity throughout the payment chain. When operating both the ordering and beneficiary side of a transaction, they are required to consolidate information to assess whether a Suspicious Transaction Report (STR) should be filed, and report accordingly to the NFIU. MVTS providers are also mandated to keep updated records of agents, assess their AML/CFT/CPF controls, and obtain CBN approval for new correspondent relationships.

Risk Management & Due Diligence

Regulations 11, 12, and 28 detail a risk-based approach for managing AML/CFT/CPF obligations. Enhanced due diligence (EDD) is required for high-risk scenarios, including cross-border transactions and dealings with politically exposed persons (PEPs). Institutions must develop robust internal control systems, designate competent compliance officers, and ensure that all staff understand their responsibilities under the Travel Rule.

Recordkeeping & Auditability

Regulations 35 and 36 establish that institutions must retain wire transfer records, customer data, and identification verification for a minimum of five years. Records must be sufficient to allow for the reconstruction of individual transactions and must be made available to authorities within 48 hours of request. This supports both regulatory supervision and law enforcement investigations.

Conclusion: WTR Compliance Integration

The 2022 CBN Regulations reinforce Nigeria’s commitment to international AML/CFT standards by integrating Travel Rule requirements across all financial institutions and MVTS providers. Through detailed provisions on data collection, verification, transmission, recordkeeping, and sanctions, Nigeria ensures traceability and transparency in both domestic and cross-border wire transfers. These regulations significantly enhance Nigeria’s compliance posture in line with FATF Recommendation 16, strengthening its defenses against money laundering, terrorist financing, and proliferation-related threats.