A Comparative Analysis of the Control of Financial Crime From the Perspective of the UK, USA and Nigeria

In 1939, Edwin Sutherland’s thesis on white collar crime drew the global attention to the bane of crime committed by persons in upper social class who use their privileged position to commit crime and are protected from prosecution by the state while persons in the lower social class who commit street crimes do not enjoy similar privilege, despite several criticisms against the thesis, it altered the theory of causation of crime and the earlier perception that financial crime is a victimless crime and thus created an awareness of the consequences of financial crime on economic development, social stability, national security, integrity of the capital market and good governance. The influence of information technology, globalisation and the link between financial crime, corruption, illicit drug trade, terrorist financing, human traffic and fraud (many of which are predicate offences of money laundering) demand a global concerted approach, development of which the UK and US laws have influenced with the introduction of national and international AML, OECD initiatives, the Vienna and Palermo conventions, the UNCAC and the FATF Recommendations. Many of these international initiatives (excluding the earlier Commonwealth initiatives) evolved from drug control measures, consequently, they have not effectively achieved the desired objectives in diverse ways, like the failure of the existing international initiatives (multilateral or mutual legal assistance) on the enforcement of transnational crimes. In Nigeria, part of the reason why regulating, interdicting and disrupting financial crime has been less effective is due to the introduction of the British method of criminal jurisprudence to Nigeria criminal justice system, in contradiction to the Nigerian traditional customary laws, values and remedies of restitution, compensation and reconciliation; consequently, the imposed foreign criminal codes failed to adequately control crime and also failed to adequately disgorge the proceeds of financial crime. While different nations have adopted various means of disgorging the proceeds of crime either by amending their adjectival laws to shift the burden of proof in certain circumstances (like criminalising the possession of unexplained wealth) without violating the offender’s right of presumption of innocence or right to remain silence, however, such adopted method must be informed by the circumstance of any given country, so far due process, equity and justice are ensured. Nigeria has not deemed it appropriate to use the prohibition of possession of unexplained wealth as an effective tool of financial crime control, except Lagos state. Again, due to the vast involvement of corporations in financial crime, an effective means of holding them liable through a clearly defined and pragmatic concept of corporate criminal liability has become necessary because this would play a crucial role in crime control. Consequently, this research questions the gross inconsistencies and ineffectiveness in the application of the organic or directing mind theory in holding complex, modern multinational corporations culpable and argues in favour of using a combination of principles of organic or directing mind, vicarious responsibility and strict liability offence (for failure to implement adequate internal policies to prevent crime by agents, similar to the provisions of the UK Bribery Act 2010, s.7) in attributing the knowledge of the agent or employee to the corporation, depending on the circumstance of a given case.The thesis argues that the future of money laundering control lies in the criminalisation of unexplained wealth, without infringing the right to own property. It identifies and proffers solutions to the problems associated with legal systems, jurisdictions, complexity of law and standard of proof, it recommends the use of civil enforcement by victim, regulatory actions, disruption of financial crime through internal control and compliance mechanisms with emphasis on recovery of proceeds of crime either through conviction based confiscation or civil forfeiture. Further, the thesis argues that due to the challenges associated with scientific means of evidence gathering and the high standard of proof in criminal proceedings beyond reasonable doubt, it prescribes that Nigeria ought to adopt the non-conviction based civil recovery of proceeds of crime, it also recommends the use of tax law to seize proceeds of money laundering. The thesis observes that the Nigeria criminal justice system needs to deemphasise the restrictive use of traditional punishment like imprisonment and fine in controlling complex financial crime, and suggested the use of clearly defined negotiated pleas like DPA, NPA and plea bargain. In addition, argues that the social and cultural factors responsible for greed and impunity must be identified and attacked in order to create a new social order, similar to the African communal lifestyle which was effective in controlling public and private corruption, notwithstanding, its basic tenet of gift giving. The thesis recommends that Nigeria ought to consider the introduction of an hybrid accusatorial and inquisitorial system of criminal justice so as to make its judiciary more participatory in criminal proceedings, it also recommends the provisions of fund for legal aid, compensation of victims of crime; prison and judiciary reform with a view to removing corruption without compromising the independence of judiciary and finally, it recommends legislations for protection and motivation of whistle blowers.