Exploring the links between foreign capital investment and Illicit Financial Flows in Nigeria

Nigeria loses between USD 15 billion to USD 18 billion in illicit financial flows (IFFs) every year. While there is stringent legislation in place governing foreign financial flows this has clearly not been enough to curb these illegitimate cross-border flows. With Nigeria’s foreign exchange reserves under pressure this has serious implications for the country’s development.

Our research explored how IFFs can be tracked and measured to ensure that legislation is being fully implemented and capital controls are transparent. It also examined which methods are used by investors to illegitimately access the Autonomous Foreign Exchange Market without limit, as well as the role banks play issuing supporting documentation to investors who are acting in breach of legislation.

SOAS-ACE is currently undertaking research in Bangladesh and Nigeria, including in the education, health and power sectors, as well as on successful collective action that overthrew a corrupt autocracy. Moving beyond pure research, we are also monitoring the implementation of anti-corruption strategies our research has recommended, such as a strategy to reduce pharmaceutical companies’ overpricing of medicines.

Our partner on this project was Dr Simeon Obidario (School of Law, SOAS University of London).