CHAPTER
ONE
INTRODUCTION
- Background
of the study
Corruption is one of the major challenges facing the
Nigerian society. It has eaten deep into the fabric of the society. According
to Adegbie (2012), corruption and other financial and economic crimes are the
bane of Nigerian development efforts. Corruption bestrides the lives of the
citizens. The judgment of Transparency International is a reflection of what
the nation has given to the world-419, money laundering, inflated contracts,
scam mails, illegal oil bunkering, disappearance of ships etc .All these crimes
harm Nigerian economy in no small measure. Ribadu (2004) stated that all these
crimes continued in the system in spite of government’s landscape steps to
address them, because many people in power want the old dispensation to
continue. He reiterated that there are those whose lives thrive culprits, yet
are willing to share in the proceeds with the event that they themselves become
culprits.
The high level of political corruption has become a
major problem that confronts the government and citizens of this nation given
its wide spread on corruption, while there are those even though they are paid
to check the activities of the
into all spheres of societal life. This ugly
phenomenon has grown to a stage whereby a day hardly passes without the issue
of political corruption being displayed on the front pages of newspapers and
magazines or broadcast in the electronic media or discussed by people. Even scholarly
literature on its societal consequences are very much on the increase. Corruption,
the foundation of economic and financial crimes has a very remote and chequered
history in Nigeria. Before the advent of the British colonial masters, traditional
methods of trial by ordinances and banishment were adopted to deal with corrupt
and wicked leaders and other individuals in the society. On arrival of the
colonial masters, efforts were made to identify and criminalize corruption.
While alien administrative officers who engaged in corrupt practices in the
colonies were recalled by the home office, indigenous public officers suspected
of being involved in corruption were subjected to probe and official
investigation. In other words there arose some areas of duplicity in the
efforts of the colonial regime in combating financial and economic crimes
(Ademoyega, 1987). The history of Nigeria from 1960 has been the accounts of
misappropriation of funds, embezzlement or looting of treasury, prebendalism
and settlements through grafts and contracts (Awoshakin 2006). One of the
reasons why the administration of Sir Abubakar Tafawa Balewa was overthrown by
the military in 1966 was alleged crass materialism among his ministers
“corruption in the high places” (Nzeogwu, 1966). After the civil war in 1970
the three “Rs” (Rehabilitation, Reconciliation and Reconstruction) were
massively embarked upon by the Gowon regime with the huge oil revenue that had
characterized the war years. The oil fortunes soon became a minus as it
prompted the arbitrary and careless Udoji Salary Awards that over- monetized
the economy, discouraged rural farming and constructed spatial inflation. The
resultant situation was the over prizing of money ahead of social values, which
caused infidelity of market forces,
embezzlement for increased financial capacity and gratifications(Adele, 1998).
Thus, since the end of the Nigerian civil war in 1970, corruption and all forms
of economic and financial crimes have assumed an intolerable problem very
difficult to attack, control and eliminate.
The sudden wealth
arising from oil, which dominated Nigeria’s exports, encouraged greed,
corruption and berthed the new trend among the political and military class to
seek power by all means because of the opulence occurring from it. About #2.8
billion of oil revenue was allegedly declared missing from the state coffers in
1978 as reckless spending characterized an unaccountable governance (Nwankwo,
1999). This prompted the Obasanjo Declaration at Jaji in 1977 sign-posting the
commencement of the battle against the creeping culture of corruption, bribery
and indiscipline.
Shagari’s Ethical Revolution
was to transform the society in which corruption and financial indiscipline had
become pandemic. The term “revolution” denoted the gravity of the decadence,
which could not be handled by Obasanjo’s Jaji Declaration. The period of
Ethical Revolution was marked by state officials amassing Wealth from public
parastatals, boards and ministries to stave off as much as possible in an
emergent era of” oil doom” (that is, a time fortunes on oil revenue had
declined considerably ) with an interface of inflation and deflation. The
Shagari’s administration responded by introducing Austerity measures, a policy
that caused severe social and economic hardships that encouraged treasury
looting, bribery, fraud and social crimes like robbery. It was the era that witnessed
the phenomenon of arson-after looting by officials in a bid to offset all
records that could trace culprits.
The image crisis encountered were a
culmination of the plethora of failed attempts in the past to eradicate or
reduce corruption in the polity. From the Jaji Declaration in 1977 by Olusegun
Obasonjo the Ethical Revolution of Shagari in 1981-83, War Against indiscipline
by Buhari Idiagbon in 1984, National Orientation Movement in 1986 and Mass
Mobilisation for Social Justice by Babangida in 1987, to the War Against
Indiscipline and Corruption by Abacha in
1996, it has been a litany of woes between military and civilian leaderships in Nigeria to stem
corruption. War Against Indiscipline (WAI) was militant and practical as
against theoretical approach to corruption and immorality pursued in 1984 by
General Buhari and Idiagbon. Setting up
military task forces the war ranged from forcing market prices down, raiding
illegal and informal black market sales outlet arresting and detaining corrupt
politicians, sentencing corrupt offenders to life imprisonment or death; to
compulsory environmental sanitation, maintenance of decorum at public places,
queuing to board buses, trains, planes, to buy stamps at post offices, in
making telephone calls, fetching water from public pipes etc.
The measures were
however considered too high handed, stifling social life and used as a weapon
to eliminate political and military opposition. The task forces were also
accused of excesses, such as raiding, looting markets, assaulting” bloody
civilians” and intimidating their petty foes or folk alike (Ake, 1987). This
attempt to curb corruption remain the situation till 1985 when Babangida regime
over-threw the Buhari administration on charges of high handedness among others.
Babangida relaxed the war and rather commenced a social and economic reengineering
policy, culminating in Structural Adjustment Programme, (SAP). The programme,
badly implemented, gave Nigeria away to foreign profiteers who collaborated
with local capital clique to make fortune through deregulation (privatization
and commercialization) (Osoba,1993). Indiscipline intensified in the polity:
crime rate escalated; short-cut to wealth through drug peddling, money
laundering and advance fee fraud 419 became phenomenal in the country. Three of
these variant of corruption and indiscipline namely, drug paddling, money
laundering and advance fee fraud or 419 were not only issues that made Nigeria
lose its goodwill in the global community, but were also the triumvirate that
became associated with the country during the Babangida regime of SAP. It was
the combination of Babangida and Abacha mismanagement of the regime of
corruption in Nigeria that galvanized the international standing of the Nation
in 2000 as one of the most corrupt nations. Speculations were made that the two
military rulers corruptly enriched themselves and so could not have controlled
the malaise because they were beneficiaries of it. The disappearance of the 5
billion dollars Gulf war oil windfall from 1991 to date added some credibility
to this speculation; while government has confirmed reports in the case of
Abacha that most of his loots have been recovered (Okojie & Momoh, 2005).
In 2002, the Nigerian
government created a corruption tsar agency with the mission “to curb the
menace of corruption that constitutes the cog in the wheel of progress; protect
national and foreign investment in the country, imbue the spirit of hard work
in the citizenry and discourage ill gotten wealth, identify illegally acquired
wealth and confiscate it; build an upright work force in both public and
private sectors of the economy and contribute to the global war against
corruption or economic and financial crimes (EFCC, 2007). The creation of
Economic and Financial Crimes Commission (EFCC) marked a significant shift from
the rhetorical talks about fighting corruption to actually doing something and
fighting corruption. Other past efforts by previous governments to provide the
legal frameworks to combat corruption included, but was not limited to, the
creation of the National Drug Law Enforcement Agency in 1989, the money laundry
act of 1995, the advance fee fraud and related offences act 1995, the Banks and
other financial institutions Act 1991, the miscellaneous offences act 1985 and
the foreign exchange miscellaneous offences act 1995. Noble and desirable these
effort were, either they were strangled due to inadequate enabling law and
regulations or neglected for apparent lack of commitment on the part of the
stakeholders to fight corruption in high places (Rebadu, 2004)
Furthermore, at the
global level, by the late 1990’s there was increased pressure on developing
countries by government of industrialized countries and international
organizations to combat and reduce corruption, which had become widespread and
was a bane to economic development. It was against this backdrop of failed
efforts and international pressure that president Olusegun Obasanjo adopted a
multi-pronged approach to fight to fight corruption in order to redeem
Nigeria’s image by creating the following agencies: The Anti-corruption
Commission, the Due Process Office in the presidency, the Corrupt Practices and
Related Offences act 2000 and the Economic and Financial Crimes Commissions
2003.
The Economic and
Financial Crimes Commission (EFCC) was established by the EFCC (establishment)
act. The Economic and Financial Crimes Commission (EFCC) is charged with the
responsibility for the enforcement of all economic and financial crimes laws,
among other things. It is a body corporate with perpetual succession and seal.
It may sue or be sued in its corporate name and may, for the purpose of its
function acquire, hold or dispose of property. It is the designated financial
unit (FIU) in Nigeria which is charged with the responsibility of co-ordinating
the various institutions involved in the fight against money laundering and
enforcement of all laws dealing with economic and financial crimes. Under
section 6(b) of the EFCC act, the commission shall be responsible for the
co-ordination and enforcement of all economic and financial crime laws and
enforcement functions conferred on any other person or authority. Thus, the
vision of the Economic and Financial Crimes Commission (EFCC) is to make
Nigeria a safe and corrupt free Nation and enhance the positive image of the
country.
Adegbie (2012) observed that over 200 convictions
for corruption, money laundering, bank fraud, advance fee fraud were recorded
by EFCC. He noted further that assets worth over$5 billion was recovered by
EFCC in less than five years of its existence. Despite all these efforts to
fight crime, there were politicization and blackmail regarding the cases taken
to court. Section 308 of the Nigerian constitution grants immunity. There were
public apathy and doubtful attitudes towards anti-corruption work. Slow justice
system, insufficient commitment by other arms of government, International
assets recovery frustration was recorded. Nevertheless the problem has grown
geometrically in the economy. Alipius (2009) stated that EFCC efforts to fight
crimes and its achievements were proved by the 2008 annual report by the United
Nation office on Drugs and Crime (UNODC) which rated the commission as the most
successful anti-corruption agency in Africa and Nigeria. Transparency
International ratings had moved from 142 in 2006 to 121 in 2008.Despite all
these achievements, Alipius stated further that the commission is faced with a
lot of accusations and criticisms from some quarters.
Notwithstanding
these achievements, Nigeria is still bedeviled by political, economic and
financial crimes as reports of embezzlements, fraud, contract inflation, etc.
Against this background; it therefore becomes imperative to examine EFCC
enforcement of economic and financial crime laws and reduction in economic and
financial crimes in Nigeria.
1.2 STATEMENT OF THE PROBLEM One
of the most fundamental problems facing Nigeria today is corruption. Corruption
has not only weakened the moral fiber of Nigeria, it has also weakening havoc of
nit’s body politics. Corruption has subverted the rule of law, eroded
confidence in the judiciary, undermined Nigeria’s ability for self-development;
discouraged the habit of industry, discipline, honesty, dedication and hard
work and made nonsense of public accountability. It had rendered patriotism
nearly impossible in Nigeria.
THE ENFORCEMENT OF ECONOMIC AND FINANCIAL CRIMES LAWS AND THE REDUCTION OF ECONOMIC AND FINANCIAL CRIMES IN NIGERIA: A FOCUS ON ECONOMIC AND FINANCIAL
