EFCC can freeze any suspicious accounts

Appeal-Court, tori_ng

The Court of Appeal in Abuja says the Economic and Financial Crimes Commission (EFCC) has the power to freeze suspicious accounts.

Economic and Financial Crimes Commission (EFCC)

Economic and Financial Crimes Commission (EFCC)

The court said the commission can direct banks to suspend operation of accounts suspected to have been used for criminal activities, or any account of into which slush funds and proceeds of crime have been deposited.

It said such a directive by the anti-graft agency to banks must however be followed by an order of a court for interim freezing, which it must obtain from a competent court, to enable it conduct investigation to ascertain the origin of the funds.

The appellate court said these in a unanimous judgment by its three-man panel on an appeal by Messrs A. R. Security Solutions Limited, which challenged the refusal by a Federal High Court in Abuja to vacate an interim freezing order earlier granted against it.

Justice Binta Nyako of the Federal High Court, Abuja had on January 25, 2016, granted an ex-parte application by the EFCC for, among others, an interim freezing order on A. R. Security accounts with Heritage Bank.

R Security applied to the court to have the order set aside, a request Justice Nyako, in a ruling on April 22, 2016, refused, prompting the company to approach the appellate court.

Justice Mohammed Mustapha, who prepared the lead judgment of the appellate court, resolved the sole issue raised for determination against the appellant.

The issue was whether the trial court was right to have held that the EFCC could obtain an order of court to temporarily freeze the appellant’s account, once the account is the subject of investigation.

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Justice Mustapha said while the EFCC was empowered, under sections 28 and 29 of its establishment Act to trace, attach and apply for interim freezing order on such suspicious accounts, the court, under Section 44(2)(k) of the Constitution, was empowered to grant such interim injunction.

He said: “The respondent ( EFCC ) clearly bears the burden of establishing that there is a prima facie evidence that the property in issue is liable to be forfeited on account of its being proceed of crime.

“That burden is discharged once there is an arrest for an offence under the Act ( EFCC Act), and the respondent traces the assets and attaches the property of the accused person acquired as a result of economic and financial crimes. That done, the respondent is entitled to an interim attachment order by the court.”

Justice Mustapha agreed with the appellant that the EFCC must show that the origin of the suspicious funds is illegal.

He added: “If bank accounts have to be investigated with any degree of success for the purpose of tracing criminality in transactions, how else can that be done without exercising some degree of control over the account?

“It stands to logic and common sense that any serious investigation of criminality in a bank account has to first and foremost start with taking control of the bank account or at least putting restraints on the account; anything short of that will be quixotic, because funds in the account investigated will simply take a flight. That is the logic behind sections 28 and 29 of the Act.

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“Prima facie proof starts, for the purpose of the Act, with arrest of the accused person for financial and economic crimes, which now denotes, at this stage, that the monies in the account are likely proceeds of crimes, and therefore, liable to forfeiture, thus necessitating the grant of the interim order.

“It is for these reasons  that the money in the accounts is fair game, because that attachment and proper investigation of such accounts will assist the respondent (EFCC) in prosecuting the accused successfully or consequently lead to the discharge of the order, depending on how the investigation goes.

“The need for credible evidence, showing the money to be proceeds of crime, underscores the necessity for the respondent’s mandate to ‘immediately trace and attach’ the property.”

He added that the grant of the interim order by the court was to enable the EFCC conduct a holistic investigation on the account to enable it establish whether or not the origin of the funds in the affected account was illegal.

“It has to be pointed out that ultimately, it is for the same reason that the grant of interim order becomes necessary, as it explains the necessity for the respondent to have, not only access, but control of the account, by having it frozen, anything else might end up being pyrrhic for the respondent,” Justice Mustapha said.

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