Nigeria to bar cash purchases of houses, vehicles in fraud fight

Nigeria will outlaw cash purchase of houses, vehicles and other major assets in a renewed effort to combat rampant fraud and stealing of public funds.

Ola Olukoyede, newly appointed head of the anti-corruption body, EFCC, said his administration as chairman of the Economic and Financial Crimes Commission will introduce a transactional credit system that prevents Nigerians from purchasing property with cash.

“Without downplaying the importance of enforcement, there is what we call a transactional credit system. If we continue to allow Nigerians to buy houses, cars and other luxurious properties by cash, because we don’t have an effective credit system, 1,000 anti-corruption agencies will not do us any good and that is the reality,” Mr Olukoyede told senators Wednesday before his nomination by President Bola Tinubu was confirmed.

The idea, which seeks to enforce electronic transactions to allow easy monitoring of financial transactions, strikes at the heart of Nigeria’s mega-corruption situation, which sees billions of naira in public funds stolen annually.

Mr Olukoyede said government officials and contractors stole about ₦2.9 trillion meant for public projects between 2018 and 2020, according to a survey he conducted, covering just 50 entities.

Losing to corruption

“I picked just one scheme, one specie of fraud, which is called contract and procurement fraud,” he said.

“If the country had prevented the money from being stolen, it would have given us 1,000 kilometres of road, it would have built close to 200 standard tertiary institutions. It would have also educated about 6,000 children from primary to tertiary levels at N16m per child.

“It would have also delivered more 20,000 units of three-bedroom houses across the country. It would have given us a world-class teaching hospital in each of the 36 states of the country and the Federal Capital Territory.”

Government agencies in Nigeria drench in corruption with officials using costly property to launder money. Such transactions are mostly conducted using large quantities of bank bills, making it difficult to trace suspects.

The introduction of a central revenue system, called Treasury Single Account, has done little to minimize public sector fraud.

“We must create an atmosphere to make sure that people have choices. If I don’t steal money, can I afford to train my children in school with good standards? If I don’t steal money, can I buy a car after I have worked for five years? If I don’t steal money, can I put a three-room bungalow in place after I had worked for 20 years?” Mr Olukoyede said.

“An average Nigerian does not own a home, when he has the opportunity, he would steal. Even if he did not have the opportunity, he would create one.”