OPINION: The problem with the EFCC

In every government or institution, there is an invisible hand that controls its affairs from afar with a great deal of influence over the decision-making process, especially on important issues. In most cases, while the leadership, and perhaps the kitchen cabinet, may be aware of this subtle equation, it is largely unknown to the rest of the team, who subconsciously believe that the administration’s decisions are not influenced by outsiders.

The Economic and Financial Crimes Eradication Commission (EFCC) has fallen victim to this invisible hand. The Chairman of the Commission, and perhaps his internal caucus, did not ignore its presence and intervention, but it may have gone unnoticed by other staff members. By vesting the power to appoint the Chairman of the Commission in the President of the Federal Republic of Nigeria, the lawmakers have, unwittingly, created an invisible hand for the EFCC. That invisible hand is the President, and thus, the Presidency.

Article 2 paragraph (3) of the 2004 Law on the Commission for the Eradication of Economic and Financial Crimes (KPK) expressly states that “The Chairperson and members of the Commission, other than ex-officio members, are appointed by the President”, and the appointment must receive the approval of the DPR.

Under this Law, the Transportation Supervisory Commission has been formed as a slave from the beginning, lacking the autonomy and courage to function effectively outside the control and rhythm of its master, the President. And because the Commission’s leadership is in control, obeying all traffic regulations issued by the President, freedom is replaced by dependence.

In such a situation, what courage can the Chairman of the Commission muster to prosecute the President’s loyalists without offending his ego and sensitivity? This is the burden of the Corruption Eradication Commission. Until the authority to appoint the Chairman of the Commission is revoked from the President, the leadership of the Corruption Eradication Commission will continue to operate under the dominance and influence of the President, carrying out his orders and tacitly obeying his will and desires, without the ethical courage to act otherwise.

No matter how committed and sincere the EFCC Chairman’s intentions are, his drive for efficiency is undermined by presidential interference. Even if angels were brought from heaven, or the heads of the Terrorism and Financial Intelligence (TFI), and the Federal Bureau of Investigation (FBI) of the United States (US) were reassigned to manage the EFCC, their competence would be undermined by the President’s influence.

This was revealed in the core allusion to the EFCC’s selective war on financial crimes and money laundering in the country. The public must acknowledge that the President is first and foremost a politician, who rules on behalf of his political party. He has loyalists and those who supported his rise to power.

Apart from political affiliations, some of these loyal supporters are embedded in both important public and private sectors.

As a politician seeking consolidation and re-election, the President may want to stand with his loyalists in times of trouble, as part of a counter-move for continued support. With this action, he curbs the Commission’s power to effectively pursue the real and powerful perpetrators of financial crimes and money laundering in the country, leaving the Commission Chairman powerless without the courage to act for fear of being removed from office. The President also has the power to suspend or dismiss the Commission Chairman.

READ ALSO:OPINION: The stories the country told me

Clearly, the circumstances that led to the dismissal of all previous EFCC chiefs can be attributed to the invisible hand of the President. To avoid this, the EFCC handles major cases that are perceived to have links to the President with caution, classifying them as people who have blue blood in their veins. This is the problem with the EFCC, and why it has failed to effectively combat financial crimes and money laundering.

Most of the former governors, ministers and other political and business bigwigs who have been prosecuted and convicted to date are those who have had weak ties or have fallen out of favor with the President. Examples include former governors of Delta State, James Ibori, and Bayelsa State, Diepreye Alamieyeseigha (now deceased), whose demands for control of resources irked President Olusegun Obasanjo. The former President believed that the former governors were a source of funding for the defunct Niger Delta agitation group, the Movement for the Emancipation of the Niger Delta (MEND), and consequently activated the invisible hand that forced the EFCC to remove the former governors.

The EFCC now operates cautiously, without free initiative, limiting itself mainly to petitions received from the public, rather than initiating and conducting investigations into suspected individuals and organizations, especially those vulnerable to financial crimes and money laundering. Ministries, agencies, government departments (K/L), the legislature, the judiciary, and the organized private sector, are black spots.

The Nigerian environment is rife with financial crimes and money laundering, especially in the political realm, yet, the EFCC feigns ignorance. Politics is a big industry and a source of quick unearned income where people become multimillionaires or billionaires overnight just by participating in politics or serving in the Executive, Legislature or Judiciary. For instance, members of the National Assembly who exercise oversight functions in various MDAs and the private sector, also double as contractors for these same organizations, despite their conflict of interest. The Niger Delta Development Commission (NDDC) is rife with such unethical practices, yet, the EFCC feigns ignorance.

Why doesn’t the EFCC interrogate legislators on budget inflation? Why doesn’t the EFCC look into the budgets of Ministries/Agencies, matching budget items with projects implemented? Why doesn’t the EFCC probe state governors and how they misappropriate Federal Account Allocation Committee (FAAC) funds, including guarantee funds and derivation funds?

While acknowledging that Nigerian banks commit about 70 percent of financial crimes in the country, why is the EFCC not investigating the bank’s chief executive officers (CEOs) for dubious fund flows, forex manipulation and round tripping? According to the Financial Institutions Training Centre (FITC), financial institutions in Nigeria have collectively lost about N159 billion to fraud since 2020, yet the EFCC has not deemed it necessary to initiate any investigation. Why are the operators and major players in the Nigerian capital market not being investigated for unlawful share price manipulation?

Furthermore, since crude oil exports account for about two-thirds of revenues, and over 90% of government foreign exchange earnings, why has the EFCC not expanded its investigation into crude oil exports to determine possible discrepancies between actual production and revenue receipts? Furthermore, why have suspected financiers of terrorism and kidnapping not been investigated and prosecuted for money laundering?

Unfortunately, since the establishment of the EFCC, corruption, including financial crimes and money laundering, has continued to increase. This is contrary to the objectives of its founder, the Financial Action Task Force (FATF) on Money Laundering, an intergovernmental organization formed by the Group of Seven (G7).

The FATF’s objective is to use the EFCC to strengthen the global fight against money laundering, especially at a time when Nigeria is listed among 23 countries that do not support the fight against money laundering. The response to this challenge resulted in the establishment of the Commission through the EFCC Act, which further expanded its scope to include terrorism financing and economic and financial crimes in Nigeria.

With corruption and financial crimes rampant in both the public and private sectors, the environment is fertile enough to keep the EFCC fully engaged. However, so far, its efforts have not been commensurate with the depth and density of financial fraud in the country. Except for cases supported by the invisible hand to be thoroughly investigated, major cases with real negative impacts on the economy are either deliberately ignored or poorly managed.

Prosecuting Yahoo internet fraudsters who have no strong links to the authorities along with those involved in spraying naira notes is not enough to justify the existence of the EFCC. If there is no underlying motive to use them as a defense mechanism to demonstrate the Commission’s efforts in combating financial crimes, this category of offenders should be handed over to the Nigerian Police Force to be dealt with.

To rid the country of illicit wealth and rampant corruption, Nigeria must review the process of appointment and removal of the EFCC Chairman to protect the office from the President’s covert influence and control. This is important given the country’s low political culture.

By: Mike Owhoko, Lagos-based public policy analyst, author and journalist

OPINION post: The problem with EFCC first appeared on Latest Nigerian News | Headlines from Ripples Nigeria.