Cryptocurrency Financed #EndSARS Protests, ICPC Tells Senate

CRYPTOCURRENCY

The Independent Corrupt Practices and Other Related Commission, ICPC yesterday told the Senate that the #EndSARS protest was largely financed by cryptocurrency.

According to ICPC, there are strong indications that could be used to fund Insurgency.

Speaking yesterday in Abuja during an interactive session with Senator Uba Sani, All Progressives Congress, APC, Kaduna Central led Senate Joint Committee on Banking, ICT, Cybercrime and Capital Market on the decision of the Central Bank of Nigeria to ban Cryptocurrency in Nigeria

ICPC Chairman, Bolaji Owasanoye however threw his weight behind the position of the Central Bank, adding that Cryptocurrency lends itself to money laundering and terrorism financing.

Meanwhile, the Nigerian Financial Intelligence Unit (NFIU) has said that his agency averted a $3million fraud linked to twenty bank accounts.

Speaking further, the ICPC boss noted that the anti-graft agency currently has a number of cases linked to Cryptocurrency but is unable to track the suspects.

He reminded the Senate on how in 2018 a number of globally rated financial institutions had their financial statements hacked with the perpetrators asking to be paid in Cryptocurrencies.

According to the ICPC Chairman, the CBN as a regulator has the responsibility to ensure sound financial stability; it will be difficult to achieve in the case of Cryptocurrencies where the role players are unknown, just as he warned that the Lawmakers to as a matter of urgency, take decisive action against Cryptocurrencies, sharing with them the experience of the Indian Supreme Court and how it ruled and admitted that it “does not know what it is”.

He said, “Virtual and cryptocurrencies pose serious legal and law enforcement risks for Nigeria. The current National Identification Number registration and linking with SIM cards is a pointer to the fact that insurgents, terrorists, kidnappers, bandits, and drug merchants have used the anonymity of unregistered SIM cards to commit their crimes with relative ease.

“Cryptocurrencies guarantee similar anonymity and can easily be used as leverage for terrorist financing and other crimes. With the NIN registration, cryptocurrencies may become an alternative payment platform for kidnappers and this would be impossible for law enforcement to agencies to trace.”

The ICPC boss cited a case study of a current investigation by the Commission on money laundering involving several hundreds of millions of naira.

According to him, “The main suspect used technology in placing the money in the banking sector. A sizable amount was traced to several bank accounts but before investigators recovered some of the money, a large proportion had been made to disappear using serpentine ICT-aided transfer schemes that have so far eluded investigators.

“While the persons whose accounts were used have been located, the criminal mastermind has remained invisible and unidentified.

“This real ongoing case is a glimpse into the world of anonymity of virtual or digital transactions. With cryptocurrencies, the wallet of the user of the cryptocurrency system only stores information or encrypted links in the Blockchain where transaction confirmation can be found.

“There is no movement of any ‘currency’ in the real sense of the word. By their very nature, they provide considerable anonymity that is almost impossible to be accessed by unauthorized persons, including law enforcement authorities.”

He further noted that the Central Bank of Nigeria’s ability to regulate monetary policy will be lost due to the fact that cryptocurrencies are issued by private entities, which are foreign, and not issued or regulated by the bank.

“It is plausible that we cannot wish virtual assets away. Central Banks in many jurisdictions are considering floating officially recognized cryptocurrencies. Whether the time is right for the Central Bank of Nigeria to follow suit is anybody’s guess, but legal guidance is needed if any fresh initiative in that direction is to have legal force,” he added.

In his own presentation, the Director/CEO, NFIU, Tukur Moddido who kicked strongly against Cryptocurrencies, said that it failed the critical tests of vulnerability and attendant risks.

According to Modibbo, the NFIU through its Cyber Intelligence stopped a scam of roughly $3 million.

Earlier, the Governor of Central Bank of Nigeria, CBN, Godwin Emefiele who maintained its previous stance that Cryptocurrency is highly inimical to the Nigerian economy and could further weaken an already weak currency Naira, said that Cryptocurrency is “money created out of thin air”, with the players untraceable and unknown.

Emefiele said, “We know enough at this stage to decide that the opaque nature significantly threatens our transaction and as you know the CBN has the primary responsibility to protect the investment of every player in the space.”

The CBN boss who noted that Cryptocurrency is used to describe the activities of players in the dark world where the transactions are opaque said that Cryptocurrency is used to facilitate scam and money laundering; adding that Nigeria has become the second in the use of Cryptocurrencies used in financing terrorism in the world.

He said, “Our business is not a popularity contest but to protect uninformed players. The decision we have taken is in the best interest of every Nigerian who has nothing to hide”.

Speaking, the Director-General of Securities and Exchange Commission (SEC) Lamido Yuguda seems to have a more liberal stance toward the use of Cryptocurrencies when he said it should and can be regulated.

Without dismissing the fears expressed by the CBN, NFIU, and ICPC, the SEC boss said his agency can develop an appropriate regulatory framework to protect investments in Cryptocurrencies and ensure the operators are duly registered.

(Vanguard)