LG financial autonomy: FG, NFIU floor governors
Written by on May 24, 2022
A Federal High Court sitting in Abuja presided over by Justice Inyang Ekwo, yesterday, delivered a judgment in favour of the Federal Government and Nigerian Financial Intelligence Unit (NFIU) on local governments joint accounts nationwide.
On May 6, 2019, NFIU had issued guidelines to stimulate the reduction of crime vulnerabilities created by cash withdrawals from local government funds across the country, beginning from June 1, 2019.
The guidelines, the agency said, include full enforcement of corresponding sanctions against violations. The guidelines limited the cumulative amount that could be withdrawn from a local government account to not more than N500,000 daily.
It also directed that any other transaction must be done through valid cheques or electronic funds transfer, among others. It said cash withdrawal and transactions from State Joint Local Government Accounts (SJLGA) “posed biggest corruption, money laundering and security threats at the grassroots and to entire financial system and the country.”
But state governments had dragged the AGF, NFIU and NULGE to court arguing that such directive was in breach of financial autonomy as enshrined in the Nigerian constitution.
But Justice Ekwo dismissed the suit for lacking in merit.