SERAP Calls for Removal of Unlawful Provisions in CBN Regulations, Highlighting Privacy Concerns

Socio-Economic Rights and Accountability Project (SERAP) has called on Mr. Folashodun Shonubi, the acting Governor of the Central Bank of Nigeria (CBN), to eliminate certain provisions in the recently implemented Central Bank of Nigeria (Customer Due Diligence) Regulations. The advocacy group expressed concerns about the inclusion of directives that require banks to collect customers' social media handles for identification purposes, which SERAP deems patently unlawful.

Demand for the Removal of Unlawful Provisions

In a letter dated June 24, 2023, and signed by SERAP deputy director Kolawole Oluwadare, the organization not only called for the removal of these provisions but also urged the withdrawal of Circular number FPR/DIR/PUB/CIR/007/076, issued on June 20, 2023. This circular mandates banks and other financial institutions to comply with the unlawful requirements concerning customers' social media handles as outlined in the CBN Regulations.

Infringement on Rights and Rule of Law

SERAP highlighted the sections of the CBN Regulations, specifically Section 6(a)(iv) and Section 6(b)(iii), which place an obligation on banks and financial institutions to identify customers and collect information on their social media handles. The organization argues that these requirements infringe upon Nigerians' rights to freedom of expression and privacy, rendering them inconsistent with the rule of law.

SERAP expressed concerns regarding the violation of fundamental legal requirements and standards by the CBN. The organization believes that the mandatory disclosure of social media handles could inhibit Nigerians from freely exercising their online human rights. Additionally, they assert that such information could be misused for political or unlawful purposes.

Call for Compliance and Legal Action

SERAP expects the recommended measures to be taken within three days of receipt or publication of the letter. In the absence of a response, SERAP threatens to pursue legal action in the public interest to compel compliance from both the acting Governor and the CBN.

According to SERAP, the requirement to obtain customers' social media handles does not serve any legitimate purpose and may unjustifiably restrict the rights to freedom of expression and privacy. The organization expresses grave concerns about the potential for the CBN Regulations to curtail constitutional and international rights related to freedom of expression, privacy, justice, and effective remedies for victims.

SERAP contends that alternative means of identification, such as passports, driver's licenses, Bank Verification Numbers (BVNs), and Tax Identification Numbers (TINs), already exist and fulfill the needs of banks and financial institutions. The additional requirement of social media handles fails to meet the requirements of legality, necessity, and proportionality, as specified by SERAP.

Lack of Justification and Interference with Rights

Furthermore, SERAP argues that the CBN Regulations and associated directive lack justification for how the use of social media handles as a means of identification improves banks' and financial institutions' ability to comply with customer due diligence regulations. They assert that obtaining customers' social media handles or addresses would unduly interfere with their rights to freedom of expression and privacy, without proportional benefits.

SERAP brings the CBN to remembrance of its duty to uphold constitutional and international human rights standards. They emphasize the interconnectedness of human rights, the rule of law, and democracy, further stressing that these principles are what form the core values of international organizations to which Nigeria belongs, including the United Nations, the African Union, and the Economic Community of West African States.

Nigerians React

In response to the recent promulgation of the Customer Due Diligence Regulations 2023 by the esteemed Central Bank of Nigeria (CBN) on the momentous occasion of June 23, 2023, SERAP and individuals have taken to their Twitter accounts to eloquently express a wide spectrum of reactions. Take a look at some of the tweets:

Another Twitter user saw this move in a positive light, expressing his views in a tweet, he said:

The tweets captured within this digital tapestry reflect the diverse range of opinions held by Nigerians concerning the recently implemented regulations and their profound impact on the ongoing fight against financial crimes.

Background on the CBN Regulations

On June 23, 2023, the Central Bank of Nigeria (CBN) took a significant step in the fight against financial crimes by releasing the Customer Due Diligence Regulations 2023. This move aims to bolster the effectiveness of anti-money laundering (AML) and counter-terrorism financing (CFT) measures while adhering to global standards. Among the provisions of these regulations is a requirement for financial institutions to gather and authenticate customers' social media handles as part of the Know Your Customer (KYC) process. By doing so, the CBN aims to enhance the accuracy and comprehensiveness of customer identification.