The Securities and Exchange Commission (SEC) has directed all capital market regulated entities (CMREs) to right away freeze the funds, belongings and financial assets of United Nations-designated terrorist financiers, together with Tehrik-e Taliban Pakistan (TTP) and its chief, Noor Wali Mehsud.
The directive was contained in an October 27 publication of the sanctions notices issued in an October 16, 2026 round obtained by Nairametrics, adopted by extra sanctions notices issued on October 19 and October 22.
However, interviews with capital market operators revealed uneven consciousness of the directives, elevating issues about how successfully the Commission communicates compliance obligations throughout the trade.
Responding to Nairametrics’ enquiries, the SEC defined that it disseminates the circulars by way of its web site, registered commerce teams and the Committee of Chief Compliance Officers of the Capital Market Operators in Nigeria (CCCOCIN).
The Commission additionally stated all regulated entities are required to subscribe to Nigerian Sanctions List (NigSac) alerts to obtain computerized notifications every time new designations are made.
SEC orders rapid asset freezes:
The October 16 round coated three people and one entity designated by the Nigeria Sanctions Committee (NSC) below the Terrorism Prevention and Prohibition Act (TPPA), 2022.
- Besides Mehsud and TTP, the designated people included Kim Jung Jong, a former Tanchon Commercial Bank consultant in Vietnam, and Mounir El Motassadeq, who was convicted in Germany in 2007.
- CMREs should determine and freeze belongings belonging to designated individuals or entities with out prior discover and report the belongings to the NSC Secretariat.
- Operators should report frozen belongings, tried transactions and related identify matches, whereas submitting suspicious transaction reviews with the Nigerian Financial Intelligence Unit.
- Firms should stop dealings with designated individuals and entities, proceed monitoring transactions and report related findings to the NSC.
- The SEC’s October 19 round added Paek Chang-Ho and Ra Ky’ong-Su following their inclusion on the United Nations Security Council’s consolidated sanctions listing.
It additionally made subscription to the NigSac Alerts system necessary for operators that had not joined.
A 3rd round, issued on October 22, added DCB Finance Limited to the sanctions listing, subjecting operators to the identical compliance obligations.
The directives require rapid motion reasonably than ready for a separate discover earlier than freezing related belongings.
Previous SEC sanctions goal operators:
The October circulars adopted earlier SEC directives requiring capital market operators to implement sanctions and strengthen monitoring of monetary transactions.
Nairametrics reported in August that the Commission instructed operators to subscribe to NigSac Alerts following the designation of six people and three Nigerian entities.
The newest circulars prolong these present compliance obligations to newly designated people and entities.
However, interviews carried out by Nairametrics counsel that consciousness of the notices varies amongst operators.
Charles Fakrogha, Chief Executive Officer of ECL Asset Management Limited, stated particular person corporations bear duty for reviewing sanctions lists and figuring out affected clients.
He defined that corporations should study their buyer information and decide whether or not any designated particular person or entity has transacted with them.
Fakrogha additionally recognized inherited buyer information as a problem, notably for corporations managing giant consumer portfolios following acquisitions.
He famous that some operators have as many as 20,000 clients, making complete screening extra demanding.
Market operators flag consciousness gaps:
Fakrogha stated he grew to become conscious of the directives when they have been mentioned on the Association of Securities Dealing Houses of Nigeria’s annual common assembly on October 28 and 29.
He argued that regulators ought to enhance communication with supervised entities to make sure that compliance necessities are understood.
- “The issue is primarily one of awareness,” Fakrogha stated.
- “To be honest, this is not something I have been paying attention to. I wouldn’t want to mislead you,” stated Abiodun Kebira, CEO of Globalview Capital Limited.
- “There needs to be better dissemination of information to ensure that operators are adequately informed and kept abreast of such developments,” stated Dr. Ayodeji Ebo, CEO of MDU Capital Limited.
Kebira stated he had not seen the circulars and had assumed they involved overseas traders, though the directives apply to all CMREs no matter their buyer composition.
He additionally argued that SEC notices ought to be communicated on to operators reasonably than relying on trade associations to relay them.
Ebo equally confirmed that he was unaware of the three October circulars and referred to as for improved distribution.
He added that asset-freezing directions from competent authorities are usually authenticated earlier than implementation.
Olubunmi Ayokunle, Head of Financial Institutions Ratings at Augusto & Co., described such measures as established safeguards inside the monetary system.
He famous that the directives have been extra immediately related to establishments receiving, holding or managing buyer funds.
Sanctions breaches carry extreme penalties:
The SEC’s directives impose rapid compliance obligations on regulated entities, no matter whether or not particular person operators have seen the printed circulars.
The October circulars don’t disclose whether or not any belongings have been recognized or frozen.
The suggestions from a cross-section of market operators highlights a distinction between the Commission’s publication of sanctions notices and operators’ consciousness of their contents.
- Some respondents stated they had not acquired or reviewed the directives, whereas others emphasised the sensible challenges of screening in depth buyer information.
- The feedback additionally elevate questions on whether or not publishing notices on the SEC’s web site offers enough visibility for obligations requiring rapid motion.
- For regulated corporations, the directives stay relevant even the place they haven’t any identified dealings with the designated individuals or entities.
The effectiveness of the measures will due to this fact rely not solely on the publication of sanctions lists but additionally on operators’ capacity to determine related accounts, implement required restrictions and report transactions to the suitable authorities.
