Combatting Corruption in Nigeria: The Nigerian Economic and Financial Crimes (EFCC)

Combatting Corruption in Nigeria: The Nigerian Economic and Financial Crimes (EFCC)

Abstract:

Corruption is a persistent cancerous phenomenon which bedevils Nigeria. Misappropriation, bribery, embezzlement, nepotism, and money laundering by public officials have permeated the fabric of the society. The office seekers of major political parties top the list of unfit or corrupt officials. Elected officials in high echelons of power and public officers use their positions to engage in corrupt activities. It is estimated that corruption accounts for 20 percent of the GDP of Nigeria. For several years, Nigeria has been at the bottom of Transparency International’s (TI) Corrupt Perception Index (CPI) ranking. In 2002, the Nigerian government created the Economic and Financial Crimes Commission (EFCC) to investigate and prosecute cases of corruption and financial crimes. This paper reviews the scope of corruption and the efforts by the Nigerian government to combat it by examining the various perspectives for understanding the causes of corruption. The study while recognizing the importance of the various perspectives, notes that both the rent-seeking and institutional theories offer deeper insights into the systemic nature of Nigerian corruption. Finally, the article examines the activities of the EFCC and notes that it faces serious challenges as the configurations of the Nigerian political landscape are uncertain.

Introduction

Corruption is a persistent cancerous phenomenon which bedevils Nigeria. It has been acknowledged in many quarters that corruption is Nigeria’s worst problem and is largely responsible for its woes, such as the instability in the Niger Delta, the debt overhang, barriers to democratic elections, and impediment to flow of foreign direct investment (FDI).1 Nigeria is not significantly dissimilar to many developing countries: corruption has been a multifaceted phenomenon characterizing the global economy. Although most studies of corruption focus on developing countries, there are few studies on corruptive practices, the role of the anti-corruption agency, and the debilitating impact of corruption on Nigeria.2

There are a number of reasons for focusing on the scope and impact of corruption in Nigeria and the difficulties in dealing with it. Nigeria occupies a central place in Africa as the most populous country, with an estimated population of over 149 million. It is one of the continent’s richest countries and is blessed with a huge diversity of natural and human resources. It is also characterized by a multiplicity of different ethnic groups. Like many mono-cultural economies in Africa, its economy is heavily dependent on crude oil. Paradoxically, it is this important natural resource that sustains corruption in Nigeria. As in many African states, corruption is a malaise that infects the society. Corruption drains from African countries over $140 billion per year.3 Corruption deters investment because it is a disincentive to potential investors; it distorts public expenditure, increases the overheads for running businesses, and diverts resources from poor to rich countries. According to Transparency International (TI), corruption accounts for about 20 percent of its Gross Domestic Product (GDP).4 Nigeria is also identified as among the top nations in the over $1 trillion annually paid globally in bribes.5 Corruption was partly responsible for the collapse of the first (1960–66) and second (1979–83) republics. These interesting facts make the choice and significance of Nigeria apt, especially as it is one of the few countries in Africa that has taken a bold step to set up an anticorruption agency to investigate and prosecute perpetrators of corruption activities. Corruption in the form of misappropriation, bribery, embezzlement, nepotism, and money laundering permeate Nigerian society. Over the years, various administrations have articulated polices and measures designed to combat corruption. Examples include General Murtala Muhammed’s (1975–76) crusade to confiscate assets illegally acquired by Nigerians; Shehu Shagari’s (October 1979– December 1983) ethical revolution to combat corruption through the introduction of code of conduct for public servants; General Muhammadu Buhari’s (December 1983– August 1985) war against indiscipline; and General Ibrahim Babaginda’s (August 1985–August 1993) ethical and social mobilization crusade. These efforts have been largely cosmetic attempts to address a systemic problem that is deeply rooted in the country’s fabric. In addition to these ethical schemes, there have been a number legislative acts and functional mechanisms to combat corruption. Prominent among them include the Banks and Other Financial Institutions Act (1991), the Financial Malpractices in Banks Act (1994), the Advance Fee Fraud and Other Related Offences Act (1995), the Nigerian Corrupt Practices and Other Related Offences Act (2000), and so forth. In its effort to fight corruption and create credibility to attract international investments, the Obasanjo administration (May 1999–May 2007) among other things, established the Economic and Financial Crimes Commission (EFCC) in 2002. The EFCC is charged with wide ranging responsibilities within the context of preventing, detecting, investigating, and prosecuting cases of economic and financial crimes in Nigeria.

Chapters: 1 - 5

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Number of Pages: 65

Price: 3000 NGN

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