Worried that the real estate sector continues to be a haven for corrupt people to hide their unexplained wealth, the Nigerian Financial Intelligence Unit (NFIU) and Estate Surveyors and Valuers Registration Board of Nigeria (ESVARBON) are teaming up in fresh push to deal with that illicit dealing.
Both institutions say they have decided to commence the process of strengthening regulations that will lift the real estate industry and minimize corrupt tendencies within the sector.
Experts have noted that real estate professionals generally have a low understanding of money laundering/Terrorism Financing (ML/TF) risks and their Anti-Money Laundering/Counter Financing Terrorism (AML/CFT) obligations.
Moses Azege, Head of Department, Real Estate and NPO at NFIU, notes that the real estate sector is attractive for money laundering due to inadequate regulatory framework, stability in value, and big ticket transaction amount.
He added that in the sector there was ease of integrating cash into construction, the high transaction volume, cash-induced economy, and little or no regulation, hence, he said it is no surprise that the sector is found attractive by money launderers.
He hopes however that if NFIU and ESVARBON could close the gap and collaborate to reverse the trend, the war against illicit wealth in the sector could be won.
Going forward, he said, the NFIU will engage more with ESVARBON as the regulator of real estate practitioners to strengthen their Anti-Money Laundering and Countering the Financing of Terrorism (AML/CFT) oversight function.
He urged ESVABRON to establish an AML/CFT Committee that will be an interface with relevant authorities, calling on ESVABRON to include in the subsequent amendments of its regulations incorporating regulations against money laundering in real estate.
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He also urged the ESVABRON to collaborate with NFIU to monitor compliance of her members with AML/CFT requirements, adding that ESVABRON should make ML/TF one of the examinable topics for intending new members.
“With collaborative efforts, Azege said ESVABRON, the NFIU and other stakeholders would be able to explore ways for shrinking the real estate practitioners’ space from quacks.
Other stakeholders in the real estate sector, who spoke at the ESVARBON’s 2022 Valuers’ Assembly in Abuja last week, noted that the real estate industry has the potential to boost the nation’s economy.
They, however, lamented that some practitioners have not been keeping to the codes and ethics of the profession, hence short-changing the profession, its professionals and the country at large.
Gersh Henshaw, ESVARBON’s chairman, assured that, as a foremost regulatory body of the valuation and property profession, ESVARBON would not relent in promoting best practices of the profession anchored on sound ethical standards, rules and regulations.
Henshaw who spoke on ‘The Role of Professional Ethics in Nation Building: Estate Surveying And Valuation Profession in Mind’, assured further that the board would continue to deepen societal awareness of the profession and roles of estate surveyors and valuers.
In his keynote address, Christopher Kolade noted that no nation could grow beyond the value it placed on its code and ethical practices, advising that estate surveyors and valuers must do everything in line with their codes of practice.
“The professional values and ethical principles in the code should be the way of life of professional estate surveyors and valuers, not only in their estate surveying and valuation work, but also in any other activity upon which they embark in their life and living.
“This must be our first conclusion: -that when these professionals do anything important for nation building; for instance, they should proceed as demanded of them by their own code of conduct,” he added.
Kolade noted that, by living and acting this way, these practitioners would ensure that their professional ethics could influence their nation-building efforts positively.
Azege, cited the GDP Report for Q1 2022 published by the National Bureau of Statistics, which says that Nigeria’s real estate sector contributed 5.34 per cent to real GDP amounting to 2.2trillion.
This, he said, makes the sector a significant employer of labour and underscores the sector’s relevance to all stakeholders.
Similarly, he noted that in the National Inherent Risk Assessment (NRA) 2016, the real estate sector was noted as highly vulnerable, adding that the sector had an overall threat and vulnerability assessment rating of Medium High (MH)2.
Azege said that in the NRA 2022, the inherent risk in the sector was rated very high. Yet, the real estate professionals dominate the activities of the Designated Non-Financial Business and Professional (DNFBP) sector in terms of the value of transactions.
