British banks warned to investigate customers more rigorously after watchdog reveals five took millions from corrupt Nigerian governors

The Financial Services Authority must enforce money laundering regulations more strictly after five British banks accepted millions of pounds from corrupt Nigerian politicians, a watchdog has warned today.

Global Witness believes that the five high street banks took the money between 1999 and 2005 from two former Nigerian governors accused of corruption, but had failed sufficiently to investigate the customers or the source of their funds.

The watchdog said that in failing to inform their clients, Britain's Barclays BARC.L, NatWest NWB-pa.L, Royal Bank of Scotland (RBS) RBS.L and HSBC HSBA.L, and Switzerland's UBS UBSN.VX, might not have broken the law but had helped to fuel corruption in Nigeria.
RBS is one of five British banks who have been accused of handling 'dirty money' from two corrupt Nigerian former governors

RBS is one of five British banks who have been accused of handling 'dirty money' from two corrupt Nigerian former governors
HSBC hit back, saying: 'Rest assured, rigorous and robust compliance procedures were followed diligently. To ignore this is to ignore the facts'


HSBC said the allegations were 'misguided' while the four other banks and Britain's regulator, the Financial Services Authority (FSA), declined to comment.

'Rest assured, rigorous and robust compliance procedures were followed diligently,' a spokesman for HSBC said. 'To ignore this is to ignore the facts.'

Global Witness's 40-page report said: 'The FSA needs to do much more to prevent banks from facilitating corruption.

'As yet, no British bank has been publicly fined or even named by the regulators for taking corrupt funds, whether willingly or through negligence.

'This is in stark contrast to the United States, where banks have been fined hundreds of millions of dollars for handling dirty money.'

Former Nigerian governors Joshua Dariye (left) and Diepreye Alamieyeseigha (right) were accused of corruption and used British banks to hide their money

Global Witness said its findings were based on court documents from cases brought in London by the Nigerian government to get funds returned that it said had been stolen by two former state governors - Diepreye Alamieyeseigha of Bayelsa state and Joshua Dariye of Plateau state.

Alamieyeseigha was accused of corruption in 2005 when he was caught with almost a million pounds in cash in his London home, and was briefly jailed in Nigeria after pleading guilty to embezzlement and money laundering charges two years later.

Dariye was arrested in 2004 in London and was found to have purchased properties worth millions of pounds even though his legitimate earnings amounted to the equivalent of £40,000 a year.

He returned to Nigeria, where the anti-corruption agency has accused him of looting public funds, though he has denied wrongdoing.

Nigeria, Africa's most populous nation, is regularly ranked one of the most corrupt countries in the world.

Most of its 150 million people survive on £1.50 a day or less, yet the country is one of the world's top champagne importers and its wealthiest residents are among Africa's richest.

The former head of its EFCC anti-corruption agency, Nuhu Ribadu, has estimated that corruption and mismanagement swallow about 40 percent of Nigeria's annual oil income.

'Without access to the international financial system, it would be much harder for corrupt politicians from the developing world to loot their treasuries or accept bribes,' the Global Witness report added.


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