How real estate developers may aid in the prevention of money laundering, IFF – ICPC
The Independent Corrupt Practices and Other Related Offences Commission (ICPC) has urged the leadership of the Real Estate Developers Association of Nigeria (REDAN) to self-regulate its members as part of measures to prevent being used for money laundering and illicit financial flows (IFFs).
IFF is the illegal movement of money or capital from one country to another that is illegally earned, transferred, and/or utilised.
ICPC Chairman, Bolaji Owasanoye, a senior advocate, spoke at the 13th Annual General Meeting (AGM) and Conference of the association held in Enugu State, according to a statement by the commission’s spokesperson, Azuka Ogugwa, on Monday.
REDAN is the umbrella body of the organised real estate sector (private and public) in Nigeria. It aims to ensure the availability of affordable housing for all of Nigeria.
Mr Owasanoye, who was represented by the commission’s Director of Asset Tracing, Recovery and Management, Adedayo Kayode, at the event in Enugu, called on the leadership of REDAN to introduce the Know-Your-Customer (KYC) principles for its clients to avoid serving as a conduit for money launderers and IFF offenders.
The ICPC chairman expressed regrets that some members of REDAN were engaged by unscrupulous individuals and Politically Exposed Persons (PEPs) to launder their ill-gotten wealth thereby exposing honest and patriotic members of the association to being labelled corrupt by perception.
He said: “It is my position that self-regulation is a way out of this quagmire for the association. REDAN should consciously draw up programmers to build the capacity of its members on modern trends in construction and also hold its members to the highest level of ethical standards.
“The association should introduce and enforce high ethical standards for its members to ensure their processes are not used for Money Laundering. In this regard, the Association may introduce KYC principles.”
He also said the theme of the event, ‘Enhancing the Real Estate Sector through Effective Regulation and Collaborations,’ was in line with the commission’s mandate of partnership and collaboration with relevant institutions toward building a mass mobilisation vanguard in the curbing of corruption and IFFs within the system and out of the country.
Mr Owasanoye also encouraged the REDAN leadership to play a role in bringing down the mounting cost of housing construction in Nigeria as well as closing the enormous gap in housing construction by collaborating with relevant government agencies.
“REDAN can serve as a buffer for its members by importing building materials in large quantities which will be made available to members at a lower cost than the open market thereby forcing down the cost of housing construction in the country.
“The Association should also exploit the possibility of partnering with manufacturers to reduce the cost of building materials and assist in making housing affordable for all,” he said.
The ICPC Chairman further urged the real estate association to consider direct involvement in low-cost housing constructions nationwide to assist the ‘Housing for All’ programme of the federal government.
ICPC investigations
He disclosed that the commission was investigating cases of fully completed but unoccupied estates in Abuja to identify developers serving as conduits for money laundering and IFFs.
He added that the commission planned to cover other major housing hubs in the country, especially Lagos and Port Harcourt, the Rivers State capital.
He recalled the outcome of a System Study and Review of Mass Housing delivery in Abuja, Nigeria’s capital city, revealing underhand dealings of some members of REDAN in the government’s housing programme.
He said REDAN members “who had been allocated huge plots of land for mass housing development in Nigeria through the Federal Mortgage Bank of Nigeria (FMBN) with particular responsibility to provide infrastructure after which allocations are made to the NHF contributors failed in the payment of their counterpart funding and the delivery of infrastructure to the project sites and rather resorted to offering and selling the Estate plots to the highest bidder contrary to the government policy.”
Mr Owasanoye urged REDAN to support law enforcement agencies in their investigations.
He also advised the association to intensify its compliance monitoring of members in areas of unwholesome practices, low-quality housing deliveries and shady financial practices.
For years, the real estate sector is fast becoming a grand problem where unscrupulous individuals and Politically Exposed Persons (PEPs) have now found it a haven to perpetuate and launder their ill-gotten wealth.
In April, the EFCC chairman, Abdulrasheed Bawa, vowed to fight financial crimes in the real estate of the economy.
A 2020 report by the Civil Society Legislative Advocacy Centre (CISLAC), a Transparency International (TI) affiliate, stated that cities such as Abuja, Lagos, and Port Harcourt are Nigeria’s major black spots for high-level capital flights, with media and court reports pointing to the involvement of criminals running fraud syndicates, drug trafficking, and property buying and development.
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