Balancing anti-money laundering measures and financial inclusion. The example of the United Kingdom and Nigeria
| Pages | 64-76 |
| DOI | https://doi.org/10.1108/JMLC-04-2018-0031 |
| Published date | 20 January 2020 |
| Date | 20 January 2020 |
| Author | Ehi Eric Esoimeme |
| Subject Matter | Financial crime,Accounting & Finance,Financial risk/company failure |
Balancing anti-money laundering
measures and financial inclusion
The example of the United Kingdom and Nigeria
Ehi Eric Esoimeme
Department of Law, Cardiff University, Cardiff, UK and
Department of Publication, DSC Publications Ltd. Lagos, Nigeria
Abstract
Purpose –The purpose of this paper is to critically examine the anti-money laundering measures of
the UK and Nigeria, to determine what the best approach is. The best approach is likely the one that
strikes a fair balance between protecting the financial system against money laundering and promoting
financial inclusion.
Design/methodology/approach –This paper reliesmainly on primary and secondary data drawn from
the public domain.It also relies on documentary research.
Findings –This paper critically analysed the anti-money laundering measures of the UK and Nigeria to
determine that the anti-money laundering measures of Nigeria does not strike a fair balance between
protecting the financial systemagainst money laundering and promoting financial inclusion because it does
not expressly provide for verification of a customer’s identity at the account opening stage for low risk
accounts. The paper, however,determined that the anti-money laundering measuresof the UK does strike a
fair balance between protecting the financial system against money laundering and promoting financial
inclusion because it requires customer identification and verification beforethe establishment of a business
relationshipfor customers who want to open a basic bankaccount.
Research limitations/implications –This paper focuses on the anti-money launderingand financial
inclusion measures in the UK’s PaymentAccounts Regulations 2015 and the Central Bank of Nigeria’s (Anti-
Money Laundering and Combatingthe Financing of Terrorism in Banks and Other Financial Institutions in
Nigeria)Regulations, 2013.
Originality/value –This paper offers a critical analysis of the anti-money laundering and financial
inclusion measures of the UK and Nigeria as provided in the UK’s Payment Accounts Regulations 2015
and the Central Bank of Nigeria’s (Anti-Money Laundering and Combating the Financing of Terrorism
in Banks and Other Financial Institutions in Nigeria) Regulations, 2013. The paper will provide
recommendations on how the measures could be strengthened. This is the only article to adopt this kind
of approach.
Keywords Money laundering, Blockchain, Financial inclusion, Bank verification number,
Basic current account, Three-tiered KYC
Paper type Research paper
1. Introduction
Two billion people lack access to formal financialservices. Approximately, 90 per cent of the
unbanked live in developing countries. Greater financial inclusion can bring these people
into the financial mainstream, with positive effects on economic growth, financial stability
and social cohesion. Many of the smartest policies for increasing access to formal financial
services have been innovatedin developing countries –those who live with the challenges of
financial exclusionevery day (Alliance for Financial Inclusion, 2017).
In general terms, financial inclusion involves providing access to an adequate range of
safe, convenient and affordable financial services to disadvantaged and other vulnerable
JMLC
23,1
64
Journalof Money Laundering
Control
Vol.23 No. 1, 2020
pp. 64-76
© Emerald Publishing Limited
1368-5201
DOI 10.1108/JMLC-04-2018-0031
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/1368-5201.htm
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