CBN Targets Financial Crime Surge with New Compliance Division

The Central Bank of Nigeria (CBN) has introduced a dedicated Compliance Department to strengthen regulatory supervision and improve oversight of financial and non-prudential risks.

A circular signed by Olubunmi Ayodele-Oni revealed that the unit was established in the first quarter of 2025 and became fully operational in the second quarter. The initiative forms part of the apex bank’s structural reforms designed to streamline responsibilities and improve regulatory focus.

Scope of Oversight
The new department will supervise:

• Financial crime risks, including money laundering, terrorism financing, proliferation financing, and sanctions compliance.
• Market conduct issues, such as disclosure standards, consumer complaints, and advertising practices.
• Enterprise security, covering cybersecurity, data protection, and third-party risks.
• Corporate governance and ESG performance, with attention to board effectiveness and sustainability practices.

Directive to Banks and Financial Institutions
All regulated institutions have been instructed to direct relevant reports and correspondence to the Director of Compliance. The CBN said additional details on reporting protocols and contact points will be issued.

The regulator described the department as “a strategic step to enforce discipline and provide robust oversight of emerging risks across the financial system.”

Fraud Concerns Rising
The reform comes against the backdrop of rising fraud incidents. In July, the CBN disclosed that financial fraud surged by 45% within a year, with 70% of reported losses linked to digital platforms, particularly unregulated virtual asset operators.

Governor Olayemi Cardoso, represented by Deputy Governor for Economic Policy Muhammad Sani Abdullahi at an EFCC event, said that while digital finance has broadened access to banking, it has also heightened vulnerabilities requiring stronger regulation and security controls.