CBN redirects banks on status, reporting line of Chief Compliance Officers

The Central Bank of Nigeria (CBN) on Friday urged Commercial Banks and Discount Houses to appoint only persons with requisite qualifications as Chief Compliance Officers (CCOs). The apex bank said in a circular posted on its Website that some CCOs in some banks and discount houses did not have the qualifications for the positions they occupied.

While the CBN declined to make the necessary and needed qualifications, it also said that some of the CCOs fell below the general manager grade and were appointed without the prior approval of the regulator.

It described the situation as worrisome, more so when the officers are prevented from reporting directly to the board of directors. According to the circular, Section 9 (1) of the Money Laundering (Prohibition) Act, 2011, required commercial banks and discount houses to designate management staff as CCOs that will operate at the headquarters and branches. Under the same section, the CCOs should have the relevant competence, authority and independence to implement their compliance programme.

It also urged the banks and discount houses to ensure that no CCO in their institutions is below the grade of general manager, without the CBN’s prior approval.

The circular said that the CCOs should report to the board of directors with “dotted lines” to the banks managing directors without interlocking roles. It said that particulars of all current CCOs, with evidence of the CBN approval of same and reporting line, should be forwarded to the Director of Banking Supervision, within one week.

The CBN said that irregular attendance of CCOs at the monthly meetings of the Committee of Chief Compliance Officers of Banks in Nigeria (CCCOBIN) had made it difficult for them to take vital decisions. It also added that the CBN would monitor the attendance by CCOs at the monthly meetings of the CCCOBIN and would not hesitate to take the appropriate regulatory action to stem the unsatisfactory attendance.

NAN recalls that CBN had on Aug. 8th, 2002 and July 8^th, 2013, directed banks and discount houses to designate Chief Compliance Officers, not below the grade of a general manager.