The Securities and Exchange Commission (SEC) has ordered all capital market regulated entities in Nigeria to immediately end correspondent banking relationships and restrict business dealings with North Korea (DPRK) and Iran, in line with updated Financial Action Task Force (FATF) guidance from its February 2026 plenary that flagged jurisdictions posing significant money laundering, terrorist financing and proliferation financing risks.
Under the August 14, 2026 circular, firms must sever all correspondent links with DPRK-incorporated, owned or controlled financial institutions, ensure no DPRK bank subsidiaries, branches or representative offices operate within their structures, and restrict or refuse transactions involving DPRK nationals, entities, government bodies or their proxies, effectively cutting off formal capital market channels tied to North Korean institutions. For Iran, operators are directed to refuse to process or facilitate transactions with Iranian financial institutions and to avoid establishing or maintaining their own subsidiaries, branches or representative offices in Nigeria or in Iran where weaknesses in anti–money laundering, counter–terrorism financing and counter–proliferation financing frameworks could create compliance breaches. Myanmar is treated differently, with entities required to apply enhanced due diligence rather than an outright ban, while a wider set of jurisdictions—including Algeria, Angola, Bolivia, the British Virgin Islands, Bulgaria, Cameroon, Côte d’Ivoire, the DRC, Haiti, Kenya, Lao PDR, Lebanon, Monaco, Namibia, Nepal, South Sudan, Syria, Venezuela, Vietnam and Yemen—remain under increased FATF monitoring and warrant heightened scrutiny.
SEC has also mandated immediate subscription to Nigeria’s Sanctions (NigSac) Alerts system to support timely Targeted Financial Sanctions, and reiterated that any unusual or suspicious transactions must be promptly reported to the Nigerian Financial Intelligence Unit, warning that non-compliance violates the Investments and Securities Act, 2025 and SEC AML/CFT Rules and could attract fines, suspension or revocation of registration.
